Even as India has almost quadrupled the bilateral entitlements with Abu Dhabi, from 13,300 to 49,970 seats a week, the civil aviation ministry has placed a cap on the number of flights airlines from Abu Dhabi can operate from these cities, to prevent revenue losses for airport operators.
According to the new agreement, Etihad can fly 3,300 passengers a week out of Delhi and Mumbai, subject to a frequency of two flights a day.
“We have made provisions to address the concerns of airlines and airport operators in India. Etihad wanted the limit on the number of flights they can operate between any airport in the country and Abu Dhabi be waived off but we ensured the limit remains on two flights a day from Delhi and Mumbai and one daily flight from any other airport in the country,” said a ministry official.
He said without the limit on daily frequencies, Etihad would have operated smaller aircraft, impacting the revenue earnings of Indian airport operators.
“The cap on frequency is to ensure they do not operate smaller aircraft and save on landing charge, thus leading to losses for our airport operators,”
He added the landing charges for the 180-seater Airbus 320 is around Rs 25,000, compared to Rs 125,000 for the medium-haul Airbus 330.
Increasing the bilateral entitlements to Abu Dhabi by 36,670 seats was opposed by the airlines as well as airport operators in India.
Jet Airways, which has announced sale of 24 per cent stake to Abu Dhabi-based Etihad, had asked for 42,000 seats between India and Abu Dhabi.
The airline plans to connect 23 destinations in the country to the world through Abu Dhabi, which will become its hub. All other airlines had asked for an increase of 12,500 seats between the two sectors.
In the bilateral negotiations held earlier this week, India and Abu Dhabi agreed to allocate an additional entitlement of 36,670 seats a week spread over a period of three years.
Of the total entitlement, 11,000 seats a week will be allocated this year, 12,800 seats per week will be added up to October 2014, and the remaining capacity of 12,870 seats per week will be added up to October 2015.
Indian carriers have utilised over 80 per cent of the total bilateral entitlements to West Asia. The utilisation by West Asian carriers stands at over 90 per cent.