India and Australia signed a revised Air Services Agreement (ASA) last week to liberalize travel between the two countries. The new arrangement gives unlimited access to Australian carriers to Delhi, Mumbai, Bengaluru, Hyderabad, Chennai and Kolkata. Indian carriers will have unlimited access to Sydney, Melbourne, Brisbane, Perth, Adelaide airports in Australia and can nominate one more airport for unlimited access.
The existing ASA had a cap of 6500 seats per week with Air India being the sole carrier to utilize seats. The Indian National carrier operates non-stop flights from Delhi to Sydney and Melbourne with the former being served five times a week and the later thrice a week. With the Dreamliner servicing the routes, Air India consumes 2048 weekly seats between India and Australia. Jet Airways has been vying flights to Sydney from its hub at Mumbai and has been allocated 2400+ seats per week. The airline which recently announced plans to start flying to Manchester and Sydney from Mumbai, is yet to announce the schedule for its Australia runs and is likely to deploy the B77W aircraft.
India – Australia is a large market with ever-growing business and cultural ties between the two countries along with a large Indian population in Australia. In the past Australian carrier Qantas has served Indian routes on numerous occasions with the last pull out being in May 2012 when it operated flights to Mumbai via Singapore. The thrice weekly service was operated by the A330s.
While the traffic is large and growing, it is fragmented and the competition to Australia routes is from Jet Airways – Qantas code share via Singapore, Singapore Airlines, Malaysian Airlines and AirAsia group and Thai Airways, all whom carry substantial traffic thru their respective hubs.
Australia has been coming up as a tourism destination for Indians with over 300,000 visitors in 2017 as per Government of Australia estimates.
The National Civil Aviation Policy of 2016 by the Indian Government had plans to liberalise air travel for countries which are beyond 5000kms from New Delhi and offer reciprocal Open-skies agreement. This agreement might not help add services in immediate future with oil prices going up from its low of 2015 and airlines in India not expanding their long haul presence at a rapid rate. Indian carriers who would want to fly one-stop to Australia will have to compete with local carriers who have heavy presence and dominance on the Australian routes.