 "Limiting bilateral rights not the way to grow Indian aviation: IAG Cargo")
Limiting foreign carriers by not expanding bilateral rights is not the right way to grow the Indian aviation market as fair competition leads to better prices for consumers, said David Shepherd, chief executive officer (CEO) of International Airlines Group (IAG) Cargo, on Wednesday.
Recently, Air India CEO and managing director Campbell Wilson had said that domestic airlines should be permitted to expand their international services, advocating against the expansion of bilateral rights. In March 2023, Emirates Airline, Jazeera Airways, and other carriers sought increased bilateral rights from India to expand their operations. The Civil Aviation Ministry rejected their requests.
"As IAG, we are not just a British carrier. We are an Irish carrier and a Spanish carrier. We will continue to fight our corner for more air services to the Indian market. We think that is what the Indian economy requires, not just on the cargo side but on the passenger side as well," said Shepherd at a press conference in New Delhi. IAG is the parent company of British Airways, Aer Lingus, Iberia and Vueling.
India and the UK are in the final stages of negotiating a new air services agreement, set to grant increased bilateral rights to airlines like British Airways. British Airways operates 56 flights per week from London to various cities in India.
"The recently negotiated air services agreement adds 14 weekly services between India and the Heathrow airport (in London). That will be shared between ourselves and Virgin Atlantic. We expect to add 7-10 services per week....I am not making an announcement of new flights here. I am trying to predict what may happen in the future," said Shepherd.
For an airline to operate international flights from one country to another, both sides must negotiate and sign a bilateral agreement. This agreement sets the number of flights or seats that are permitted to operate per week between the two countries.
"I think that inevitably, Indian aviation is going to grow. The size of the economy and population is going to propagate that growth but I don't think that limiting international carriers into the Indian market is necessarily the right way to go about that," he said.
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He said that in most of the countries globally, there is a balance between local carriers and foreign carriers when it comes to that country's international traffic.
"The UK is a great example. We fly a lot across the transatlantic. United, Delta, American, JetBlue (all US-based carriers) -- all fly across the Atlantic to the UK. So, there needs to be room for competition because it is competition that drives the normalisation of an economy. Make sure that your manufacturing companies and producers are given a fair share (prices) in terms of how they are managed by people who are plying transportation services in that market. So, it is important that the market sees competition. And I think it is important that fair competition between national and international carriers continues to be the way," he noted.
"I think that since Brexit, and the fact that the UK has to come out of the European free trade agreement, it is absolutely critical for the British economy to try to create a network around the world for trade to happen."
The UK is a relatively small country, he said, and it has depended on trade and commerce with countries around the world for hundreds of years. "The position that we have retracted to (after Brexit), it is critical that we establish trade links on a bilateral basis with countries around the world. Probably, no country is more important -- given it scale and growth -- than India. There is intent from both sides on how that free trade agreement is established but clearly, both the parties have their own interests in terms of what they do."