Ravi Prasad NEW DELHI India's state-owned carriers, Air India and Indian Airlines, are clashing over the right to fly routes from the subcontinent to the Persian Gulf.

Loss-making Air India is lobbying the civil aviation ministry to wrest these lucrative routes from its domestic rival, which is fighting back in a rearguard action against any such move.

"Why doesn't Air India fly to more destinations where it has an opening, instead of trying to poach on [our] routes?" asks Indian Airlines managing director Anil Baijal in a letter to civil aviation secretary P V Jayakrishnan, who is also chairman of Air India.

Baijal criticises Air India's demand to be given sole rights over the Gulf routes. "If what is being sought by Air India is only the freedom from having to compete with Indian Airlines, then it needs to be stressed that if Air India cannot match what Indian Airlines represents, it is inconceivable that Air India would be able to match the competitive pressure of the foreign mega carriers," says Baijal.

According to the Indian Airlines managing director, Air India fulfils less than one-third of its bilaterals. What it does instead, he says, is virtually to sell these rights to other global airlines and collect "royalty". Baijal says Air India has thrived in an era of regulation and protectionism and earns about Rs1.5 billion ($34.5 million) a year just from royalties and commercial arrangements. He says it is absurd to blame Air India's losses on Indian Airlines' limited international routes.

Indian Airlines operates flights to Dhaka, Colombo, Singapore and Kuala Lumpur, as well as to important Gulf cities. With its declining global operations, Air India is eyeing the lucrative Gulf and South-East Asian routes. The flag carrier asked both Boeing and Airbus to give it quotes for aircraft essentially intended for flying the Asian routes.

Source: Airline Business