India market too lucrative to ignore, says Etihad Airways chief

India is a challenging market for airlines seeking expansion in the subcontinent says James Hogan, president and chief executive of Etihad.

The Indian subcontinent and its growing number of travellers promise big returns for Etihad, says James Hogan, its president and chief executive. Paulo Vecina / The National
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The Indian market is proving a tough one to crack for Etihad Airways, but it is too lucrative to ignore, the airline's chief says.

"In India we still have to negotiate by seats," James Hogan, president and chief executive of Etihad, said at the summit yesterday.

Under an air-traffic rights agreement between the UAE and India, a cap has been set on the weekly number of seats Etihad can operate.

"One of the biggest challenges we face is convincing governments that airlines should have greater and easier access," Mr Hogan said.

The Indian subcontinent and its growing number of travellers promise big returns for the carrier.

"How you collaborate is also key," Mr Hogan said.

Etihad claims to have struck the world's first "equity alliance", after deals with Air Berlin, Air Seychelles, Virgin Australia and Aer Lingus.

While it flies to 86 destinations directly, it reaches 400 destinations through its alliance network, flying 75 million passengers.

The equity alliance has US$16 billion (Dh58.75bn) in combined revenues and delivered 1.2 million passengers to the Etihad network, while contributing 19 per cent to its passenger revenues.

Forming partnerships with airlines that travel to secondary cities in India and Pakistan would also open new markets for carriers worldwide, Mr Hogan said.

The Indian government had announced that Etihad was in talks to buy 24 per cent stake in India's Jet Airways, although last month it said there had been no formal proposal from Etihad.

Emerging and high-growth markets such as the Commonwealth of Independent States, Indian subcontinent and South-East Asia offer great opportunities for airlines, Mr Hogan said yesterday.

Connecting centres such as Dubai, Abu Dhabi and Doha, and low-cost expansion through resource sharing are also important to growth.

"We are seeing the emergence of the battle of the hubs, and so that connectivity model is vital," Mr Hogan said.

"Government policies make it difficult to move as fast as one would like but we are seeing strong opportunities for growth."