As early as next month low-cost carrier Indonesia AirAsia will be launching services from Jakarta to Singapore and Bali to Singapore, marking a major regulatory break-through between Indonesia and Singapore.

"We just received the regulatory approval from the Civil Aviation Authority of Singapore (CAAS) and we are trying to start from next month," Indonesia AirAsia marketing manager Herjanto Widjaja says from Jakarta.

He says the airline plans to launch daily services from Jakarta to Singapore and Bali to Singapore and soon after that launch a Yogyakarta-Singapore service.

This is significant because AirAsia has for years wanted to operate services on high traffic routes between Indonesia and Singapore but the CAAS has blocked it because of an impasse between the Indonesian and Singapore regulator.

In January 2005 Indonesia AirAsia, which was then called AWAIR, tried to launch a Jakarta-Singapore service but the CAAS blocked it just prior to launch.

It was later revealed that the CAAS' decision was part of a 'tit for tat' dispute between the CAAS and the Indonesian civil aviation authority.

The Indonesian side had blocked Singapore low-cost carriers from operating on the high-traffic routes between Singapore and Indonesia - in an effort to protect incumbent carriers such as national airline Garuda Indonesia - so the Singapore side responded likewise.

But since 2005, southeast Asian countries have increasingly been liberalising air services, paving the way for low-cost carriers to expand.

Herjanto at Indonesia AirAsia says the airline currently has five Airbus A320s and seven Boeing 737-300s and plans to add one more A320 in March or April and have a total of 10-12 A320s at year-end.

He says the airline is also working to launch a service from Bali to Perth in Australia but is still waiting on approval from the Australian regulator.

A spokeswoman in the Kuala Lumpur headquarters of AirAsia group confirms that the Indonesian carrier will launching services soon on the three routes.

She declines to comment further on this except to say AirAsia will be organising a media event in Singapore to announce the news.

In a separate development, the spokeswoman says AirAsia of Malaysia will be launching a daily service in March from Kuala Lumpur to Dhaka in Bangladesh using A320s.

Source: Air Transport Intelligence news