Emirates, Etihad, Qatar Airways see 70% India flyers transit at hubs

This raises govt concerns over undercutting Indian carriers' international plans

A substantial portion — over 70 per cent — of passengers flying on Emirates, Etihad, and Qatar Airways flights connected to India utilised the airlines’ hubs in Dubai, Abu Dhabi, and Doha as transit points for travel between India and third countries in February this year, according to aviation analytics firm Cirium’s data reviewed by Business Standard.
 

This substantial share of ‘sixth freedom’ traffic, referring to passengers using an airline’s home hub to travel between two other nations, involving India has raised concerns within the Indian government.

Officials believe this passenger flow impedes the growth of long-haul and ultra-long-haul international operations of domestic carriers such as Air India. Consequently, the Indian government has refused to increase bilateral traffic rights to the abovementioned three Gulf hubs in recent years.

Government officials informed the newspaper that India has conveyed its apprehensions regarding the high proportion of sixth freedom traffic to the governments of the United Arab Emirates (UAE) and Qatar, the home countries of these three carriers, during multiple meetings in 2023 and 2024.

The cumulative share of sixth freedom traffic on flights connected to India handled by these three Gulf airlines stood at a substantial 70.8 per cent in February this year, marking an increase from 68.5 per cent recorded in the same month last year.

Queries sent by Business Standard to three airlines — Emirates, Etihad, and Qatar Airways — and to the Ministry of Civil Aviation remained unanswered until the time of going to press.

Qatar and the UAE have asked India for an increase in bilateral air traffic rights as their carriers have already utilised their quotas.

For example, under the bilateral air service agreement signed between India and the UAE in 2014 for India-Dubai routes, each country’s carriers can fly 66,504 seats per week in each direction. Emirates has exhausted its entire allocation of bilateral rights, currently operating 334 weekly flights between India and its hub in Dubai.

In March last year, Civil Aviation Minister Jyotiraditya Scindia said that India was not looking to increase bilateral air traffic quotas with Gulf states, instead encouraging Indian carriers to offer non-stop long-haul flights on larger planes. In January, he reiterated this, expressing India’s interest in granting more bilateral rights to countries with significant ‘point-to-point’ traffic with India.

In February 2024, Emirates transported 402,299 passengers to and from India, with 62 per cent of them utilising Dubai solely as a transit hub for travel to and from third countries.

Etihad carried 250,233 passengers travelling to and from India during the same period, with 74.1 per cent of them utilising Abu Dhabi as a transit hub.

Meanwhile, Qatar Airways served 228,382 passengers to and from India, with 82.8 per cent of them using Doha as their transit hub.

India’s widebody aircraft fleet has stagnated over the past 15 years, in stark contrast to the expanding fleets of carriers like Emirates and Qatar Airways. This disparity has enabled these foreign airlines to capture a substantial share of international passenger traffic to and from India through their one-stop flight services.

Indian carriers currently operate just 67 widebody planes, accounting for less than 10 per cent of their total fleet. In comparison, Emirates and Qatar Airways operate 260 and 216 widebody planes, respectively.

Widebody aircraft, with larger fuel tanks and engines, are designed for longer routes such as India-US, India-Europe, and India-Oceania.

In March, Air India Chief Executive Officer (CEO) and Managing Director Campbell Wilson highlighted this phenomenon, stating that airlines based around India have thrived due to Air India’s weakness, but the carrier now has an opportunity to reclaim the market and establish the country as a hub for travellers.

Wilson had previously opposed granting more bilateral rights to foreign carriers, arguing that Indian carriers need sufficient space to grow.

“From 2010 until now, there has been a virtual freeze on long and ultra-long-haul capacity by Indian carriers, despite India’s gross domestic product (GDP) increasing 2.5 times and GDP per capita by 2.2 times. India is perhaps the only high-potential market with such strategic capacity constraints,” said Kapil Kaul, CEO and director, CAPA India, last month.

India’s long and ultra-long haul market requires the deployment of the equivalent of 130-140 widebody aircraft as of today, to handle just over 20 million passengers.

According to CAPA India, the India-US market alone, with roughly 6 million annual bidirectional passengers, requires the equivalent of 60 widebodies. Indian carriers currently deploy just 15 such aircraft on the India-US route.

Indian carriers are now boosting their widebody fleets. Last month, IndiGo placed an order with Airbus for 30 A350-900 widebody aircraft, estimated to be worth between $4 and $5 billion. In February 2023, the Tata-run Air India Group ordered 470 planes, comprising 250 from Airbus and 220 from Boeing, of which 70 would be widebody planes.