Currently, the Gulf region is reserved for national carriers Indian Airlines and Air India, along with its international low-cost carrier Air India Express for a period of three years, which expires in 2008.

Jet Airways [Get Quote] and Air Sahara (now JetLite following the acquisition by Jet) -- which have been lobbying for opening it up -- would be the first airlines flying in these routes.

"The government is planning to relax the norms for the international operations to three years of operations and 20 aircraft in its fleet against the current five years and 20 aircraft. The new civil aviation policy envisages this relaxation is irrespective of international destinations," said government sources.

This would mean that any airline which has completed three years of operations can fly on the Gulf route, which is considered a cash cow. If the Cabinet approves MoCA's proposal, low-cost carrier Air Deccan can immediately fly Gulf, while Vijay Mallya-promoted Kingfisher Airlines and another Delhi-based budget carrier SpiceJet can make it to the Gulf destinations by May 2008.

At present, international carriers, including Gulf Air, Etihad, Emirates and Qatar, are operating on the India-Gulf route.

"The Gulf route is one of the most lucrative routes. For instance, the Gulf contributes nearly one-fourth of Air-India's revenues, about Rs 6,000 crore, while it is around 18 per cent for Indian Airlines. Air India Express registered profit in its first year of operations, thanks to the Gulf," industry sources said.

Sources from Air Deccan said the airline was studying the Gulf route as it was interested in operating the nearest international routes such as Colombo, Singapore, Malaysia apart from all the Gulf destinations.

Kingfisher Airlines Executive Vice-President Hitesh Patel said Kingfisher was interested in flying Gulf and south-eastern destinations, if the government permitted.

"Certainly, we are interested in the Gulf destinations. We are planning to examine the potential of the route before commissioning the flights. If the government relaxes norms to three years, SpiceJet can fly from May next year," SpiceJet Director Ajay Singh said.

Sources said the government was also planning to restructure the Directorate General of Civil Aviation and Airports Authority of India, which will enable them to provide better operational efficiency.