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Air Arabia evaluating Indian airline acquisition

Sharjah-headquartered Air Arabia, the largest low-cost carrier operator in the Middle East and North Africa, has confirmed that it is considering an investment in FlyEasy, a new Indian budget airline that has yet to launch. According to the International Air Transport Association (IATA), India’s domestic airline business is currently the fastest growing in the world, showing a ​13.2 percent growth in revenue passenger kilometers (RPF) in September 2015 (compared with September 2014).

FlyEasy, which is based in Bengaluru (Bangalore) in the state of Karnataka, is waiting for an air operating permit (AOP) from India’s Directorate General of Civil Aviation. The new operator has leased two Embraer E-190 jets for its launch. Sixteen Indian groups (including FlyEasy) have received no-objection certificates from India’s ministry of civil aviation to launch new airlines since 2011, but only four have so far received AOPs.

Air Arabia has been pursuing an aggressive expansion strategy and has added 21 new routes to its network in the first nine months of 2015, increasing the total number of destinations to 115 routes. New routes include Urumqi, the first China route for a low-cost airline from the Middle East and Africa. The company also started a loyalty programme this year.

In 2014, Air Arabia opened its second UAE hub at Ras Al Khaimah International Airport and reportedly requested permission to open additional routes to India via the new hub, but was turned down by Indian aviation authorities. Analysts speculate that an investment in an Indian-based carrier might pave the way for a sixth Air Arabia hub and more international flight connections with India in the future.

Source: media, IATA

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