Emirates CEO Tim Clark said he hopes for the recently signed free trade agreement between India and UAE to make room for more cargo as well as passenger transport between the two countries, but added the government’s imposed constraints on foreign airline operations is “vexing”.
The free trade agreement, which came into effect in May, allows duty free exports of textiles, agriculture, dry fruits, gems and jewellery to the UAE market.
“I saw embracement of the two countries for the FTA but it has not manifested itself in more flights to India. I am hoping that will come,” said Clark on the sidelines of the annual general meeting of International Air Transport Association (IATA) in Doha.
“All I can say is that it is in the hands of the Indian government. Since 2015, we have been requesting for more points, more frequencies and more seats,” he said.
“I do not think anyone could be more persuasive than we have been in the value of doing that,” he added.
India has, for the last few years, been trying to rework its bilateral air services agreements with the UAE, unifying all the rights under one umbrella. That would curtail the number of flights allowed to each airline. The middle eastern carriers have been up in arms against it. There has been no final decision on it yet.
“We know the story of India. And yet, they have this constraining approach to aviation, which has not helped the economy,” he said.
“But these things have always been, dare I say, vexing for the Indian government,” he added.
“These are all bad ideas that retard the recovery of aviation and tourism,” he said at the industry association’s annual general meeting in Doha while giving the example of Thailand, which wants to levy tourism tax to increase its revenue, as well. “Any measures that increase costs and depress airlines’ ability to increase revenue are bad for the economics of aviation.”
Aviation fuel in India attracts the highest level of taxes in the world. Airlines have been requesting the government to bring the fuel under goods and services tax (GST). The government hasn’t done that yet.
