Facing Western sanction, Russia asks Indian airlines to fly domestic routes

Russia proposed a 'cabotage' agreement, which would permit foreign airlines to carry passengers within its borders, to India, China, and several Central Asian countries about a month ago

Marred by Western sanctions for over two years now, Russia has extended an invitation to Indian airlines to operate domestic routes within its territory, a move prompted by its own carriers’ inability to meet local demand, according to a report by The Economic Times. 

 

In a bid to address its aviation challenges, Russia has proposed a ‘cabotage’ agreement, which would permit foreign airlines to carry passengers within its borders. This proposal was presented to India, China, and several Central Asian countries about a month ago and was discussed further during Prime Minister Narendra Modi’s recent visit to Russia for the BRICS summit.

 

 

The western sanctions have restricted Russian airlines’ access to US and European aircraft manufacturers and essential parts.

 

Indian airlines, however, have expressed concerns over the viability of such operations in Russia.  The Economic Times report mentioned that airline companies cited difficulties, including potential opposition from aircraft lessors and insurers, both of whom are restricted by the Western sanctions on Russia following the Ukraine conflict. Additionally, Indian carriers are already grappling with a shortage of planes to meet domestic demand, further complicating any potential operations in Russia.

 

Challenges with aircraft leasing and insurance

 

Most Indian airlines operate leased fleets, and many of these lessors are unwilling to permit aircraft to fly to Russia due to the imposed sanctions. The news report quoted a senior airline executive saying that this restriction, coupled with the risk of losing insurance coverage, makes the proposal highly unviable. The executive said the airline industry is struggling with a limited supply of aircraft, affecting their planned expansion within India.

 

Sanctions hampering Russian airline operations

 

Before the Ukraine conflict, Boeing and Airbus aircraft made up a significant portion of Russia’s fleet. However, sanctions have led to a halt in planned deliveries to Russian airlines, with planes originally intended for Russian carriers being redirected to other markets.

 

An example is Air India, which recently received Airbus A350s initially allocated for Russian carrier Aeroflot. Additionally, Western companies have ceased component and software support for Russian aircraft, leading to prolonged groundings and stalling fleet expansion.

 

Sanctions have dampened growth prospects for Russian airlines. CAPA (Centre for Aviation) reports that domestic seating capacity remains at pre-pandemic levels, with the active fleet dropping from 874 in 2019 to 771.

 

CAPA forecasts suggest minimal growth in Russian passenger traffic, with an expected 98.8 million passengers by 2027 — similar to 2024 levels.

 

Despite sanctions, India and Russia continue to maintain robust trade ties, with India being one of the few countries allowing Russian carriers to operate flights. Air India, taking advantage of Russian airspace, continues to operate routes over Russia, benefiting from shorter flight times compared to European and US airlines.