Jet seeks three-fold expansion of India-Abu Dhabi services

As Jet-Etihad talks over equity investment continued, the Indian carrier has sought expansion of air-service capacity between India and Abu Dhabi by three-folds.

Urging the government to initiate talks with Abu Dhabi on the bilateral air services agreement, Jet has written to the Civil Aviation Ministry seeking its nod for expanding its services through Abu Dhabi and expansion of bilateral aviation ties with that country.

"Jet Airways has evaluated the business, tourism and travel potential of the Indian market, basis a comprehensive assessment and has accordingly applied for the grant of additional capacity entitlements to increase services to Abu Dhabi. The airline has a network strategy and a fleet induction plan to support this growth. The expansion is intended to provide a wider consumer choice to the Indian traveller by connecting 23 cities across the country to the international market with a proven Indian product," the company said in a statement.

Similarly, other carriers have also sought massive expansion in their weekly schedules, with IndiGo demanding over 5,000 more flights, SpiceJet 5,936 more and Air India 2,400 additional services, official sources said.

Following this, Civil Aviation Ministry officials held a meeting with representatives of airlines earlier this week to seek their justification for enhancing air services.

Under the current bilateral agreement with Abu Dhabi, Indian carriers are jointly allowed to operate 13,300 seats each week on that route, with two per cent operational flexibility on this capacity.

In its application, Jet is understood to have planned to connect to 23 Indian cities with Abu Dhabi in the long and medium term, requiring over 41,000 seats per week by 2016.

Given the requirements, it suggested that the existing capacity entitlements of Indian carriers under the bilateral agreement be expanded by over 40,000 seats and urged the government to expand the India-Abu Dhabi bilaterals by almost 54,000 seats each week.

Maintaining that capacity requirements were much larger than those available under the existing bilateral arrangements, Jet urged the government to initiate bilateral talks with Abu Dhabi to meet these additional requirements, the sources said.

Jet has also sought government's permission to allow it to codeshare for Etihad flights on which it is currently not allowed to.

If Jet's plans are approved, Etihad would cater to Jet's traffic to North America, Europe, Africa and the Middle East from Abu Dhabi with its code, while Etihad's India-bound traffic would be operated by Jet flights from Abu Dhabi.

The move is being seen as an attempt by Naresh Goyal's airline to finalise its deal with Etihad, which has been pending for quite a few months now. A major factor for the delay in clinching the deal is the absence of a Bilateral Investment Promotion Agreement between the two nations.

Etihad has been in talks for a 24 per cent equity stake in Jet worth around $300 million, since India relaxed ownership rules and allowed foreign airlines to buy up to 49 per cent stake in local airlines. A few weeks ago, the Gulf carrier paid Jet $70 million for the latter's three slots at London's Heathrow Airport.

Jet Airways chief Naresh Goyal met Civil Aviation Minister Ajit Singh on Thursday and is understood to have briefed him on the ongoing negotiations over the deal. (Read full story)