Gulf carriers swoop down on A-I, Indian

It's one of the most lucrative destinations for India's national carriers. But that's steadily changing. Air-India and Indian now face a slew of competitors in the West Asian market as low-cost carriers like Air Arabia and Jazeera Airways swoop down, offering cheaper than-ever fares to the five million non-resident Indians there.

The average one-way fare of Air India (140 flights to the Gulf) and Indian (98 flights) is around Rs 5,000-Rs 9,000. Carriers like Jazeera—offering services from Mumbai and Delhi to Kuwait—is pricing its ticket as low as $30 (Rs 1,380).

''Nearly 34% of India's total outbound travel is to West Asia. It is a strategic market for us and we plan to add more destinations in the country,'' says Marwan Boodai, Jazeera Airways' Chairman and CEO. Apart from Jazeera, the national carrier of UAE, Etihad Airways, is also launching its service from India to Kuwait with a stop in Abu Dhabi and Khartoum.

''The importance of the Indian market to us can be gauged from the fact that India is the third-largest country in our network,'' says Neeraja Bhatia, Etihad Airways' area manager.

Sure, with a 35% share of the India-originating market to the Gulf—UAE, Qatar, Oman, Bahrain, Kuwait and Saudi Arabia—the national carriers have a headstart. Air-India, for one, derives over 30% of its revenues from the sector. ''The national carriers would only be affected if these new airlines are allowed to start operations to Kerala in the south or destinations like Jeddah, Riyadh or Dammam are opened up for them,'' says an aviation analyst.

Either way, experts say with the moratorium on private sector domestic airlines flying to Gulf set to expire in the next 18 months—and increasing demands by NRIs to implement open-skies policy on this route—the domestic carriers will have to tighten their belts to face this increasing competition.

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