Dubai: If India goes ahead and restores normal airline services to the UAE and other countries from November 1, ticket rates could see an immediate drop.
Based on initial bookings data, fares from New Delhi to Dubai could drop to Dh900-Dh1,7000 in the initial days of November, while those from Mumbai could drop below Dh2,000. Kochi-Dubai flights start from Dh960, and one from Thiruvananthapuram can cost up to Dh1,800.
Meanwhile, flights from Dubai to New Delhi and Mumbai, which until last month were Dh300 to Dh500 could see significant increases. Apart from rapidly increasing fares, passengers from India also have to bear the cost of a Rapid PCR test, which has to be taken within six hours of departure. Depending on the airport in India, these can cost Dh190–Dh220.
“Rapid PCR kits are expensive - there is a travel agreement between India and UAE which mandates the COVID testing before boarding the flight for UAE. Also, for Europe,” said a user on a Twitter thread where people were bemoaning the high cost of testing at Indian airports.
Restoring services
Whatever be the immediate impact on rates, November 1 will mark a significant change for global airlines on their India prospects. After postponing the resumption of international services multiple times, India’s civil aviation authorities finally set November for a return after the COVID-19 created disruption.
Until now, India has had a ‘air bubble’ agreement with UAE, which limits the number of flights operated on the route. “The fares on the India-UAE route currently, especially to Dubai, are astronomically priced largely due to a short supply of seats and unprecedented demand for travel,” said Vinamra Longani, Head of Operations for Sarin & Co, an Indian law firm specializing in aircraft leasing and finance. “Should the government of India permit airlines to add capacity irrespective if it's through an expanded air bubble or resumption of scheduled flights, fares should go down.”
India had earlier announced that it would grant tourist visas to foreigners wanting to come to India on chartered flights with effect from October 15. Those travelling to India on flights other than chartered aircraft would be able to do so from November 15.
“It makes sense now to revoke the suspension of scheduled flights and drop air bubble arrangements altogether,” added Longani.
Peak season
UAE, which is hosting Expo 2020 and the T20 World Cup, is entering its peak tourist season, which starts from November and goes all the way until March. This too could have a say on ticket rates. “We we don’t expect any drastic reduction in rates on the UAE-India sector,” said Suraj Ramesh, Tours Manager at Al Badie Travel Agency.
Air India will announce new routes in coming months, including a direct flight connecting Dubai to Goa, said Ramesh. “When such kind of additions happen, you have a reduction in fares from a sector like Mumbai – a lot of people in Dubai are connecting to Goa using that particular route.”
Air India Express, the budget unit of India’s flagship carrier, will resume flights between the South Indian city of Kozhikode and Al Ain in December, as per booking websites. Ramesh agreed that a return to pre-COVID-19 schedules will be required for flight ticket prices to be impacted. “I think three or four flights a week is really not going to push down fares significantly.”
“In addition to being reliable, testing needs to be easily accessible, affordable, and appropriate to the risk level,” said Willie Walsh, IATA’s Director-General, in a statement earlier this year. “Too many governments, however, are falling short on some or all of these - the cost of testing varies widely between jurisdictions, with little relation to the actual cost of conducting the test.”
Air bubble rationale
India operating flights under air bubble arrangements gave the country’s airlines an advantage. The ‘India-first’ approach on certain routes ensures that India’s carriers do not face direct competition from operators in the UAE or other countries.
In August, the head of Sharjah’s Air Arabia Adel Ali called for an open-sky policy between UAE and India instead of an air service agreement between the two countries. An open sky air service agreement allows for airlines from the two countries to have an unlimited number of flights as well as seats to each other’s jurisdictions.
Ali said that certain protective measures taken by Indian authorities were slowing Air Arabia’s growth in the Indian market. “As a result of what India has done, our business to a number of other Subcontinent (countries) has grown.”
