Government may not open up Gulf sectors to private airlines

Indian Airlines and Air-India might get to hold on to exclusive rights to the highly lucrative Gulf sector beyond the January 2008 deadline. As part of the new civil aviation policy – expected to come into effect early next year, the government has proposed extending the restriction on private carriers from operating in the Gulf region to 2010. The Gulf sector accounts for almost 40% of the total outgoing seat revenue. While over 30% of Air-India’s Rs 9,500 crore revenue in 2005-06 came from the Gulf region, for Indian Airlines that figure stood at 20% of its revenue of Rs 5,789 crore. According to industry estimates, domestic carriers have a market share of about 45% in the India-West Asia route. Air-India and Air-India Express, a fully-owned subsidiary of Air-India, together account for 150 flights a week to the region. Indian Airlines has 105 flights a week. The eight countries in the Gulf region that comes under policy restrictions are Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates. At present, seven scheduled carriers operate from the Gulf to India. These include Emirates, Gulf Air and Etihad Airways and Air Arabia.

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