Air India CEO Advocates Cautious Approach to Foreign Carrier Access in India

The CEO of Air India, Campbell Wilson, has urged the Indian government to exercise prudence in allocating additional capacity rights to foreign carriers, emphasizing the need to allow local airlines to expand and become more competitive first. Wilson emphasized that a balance must be struck, encouraging the growth of the domestic market while fostering the development of local airlines.

In an interview with the Hindustan Times, Wilson stated, “I think the strategy is to contain traffic rights expansion so that local airlines have the opportunity to spin up and attain scale and become competitive.” He believes that liberalization of traffic should follow this phase of local airline development.

Wilson specifically highlighted the threat posed by Gulf airlines, which handle significant amounts of sixth freedom traffic. He expressed concern over the potential impact on the Indian aviation sector and stressed the importance of supporting Indian businesses and international connectivity.

While several foreign operators seek additional traffic rights in and out of India, the government has been cautious, prioritizing the strengthening of the local aviation sector. Wilson’s remarks come as part of the ongoing debate on whether to grant additional rights to foreign carriers, with a focus on protecting and nurturing the growth of Indian carriers.

According to ch-aviation capacities data, India is served by 85 airlines offering scheduled passenger flights. IndiGo Airlines leads the market with a 16.56% share, followed by Air India with 11.88%, and Air India Express with 7.48%. Vistara, a joint venture of Air India and Singapore Airlines, holds a 3.69% market share and is set to merge with Air India in 2024.

Wilson’s comments come as Air India undergoes a significant restructuring and fleet upgrade, with 497 aircraft on order. The pending merger with Vistara, along with Tata’s low-cost carrier interests, positions Tata-controlled airlines as dominant players in terms of raw seat capacity.

The debate on foreign carrier access in India has intensified, with Gulf carriers like Emirates seeking additional capacity, emphasizing its potential economic value. However, the Indian government’s cautious stance has drawn parallels to protectionist measures, according to IATA Director General Willie Walsh. The discussions underscore the delicate balance between fostering local growth and integrating into the global aviation landscape.