Akasa Air faces hurdles in securing United Arab Emirates flight rights, challenging aviation giants as it fights for fair competition and global expansion.

India’s youngest airline, Akasa Air (QP), has been making significant strides in the aviation industry, but its ambitious expansion plans have hit a major roadblock. The airline is struggling to secure flight rights to the United Arab Emirates (UAE), a crucial market for Indian carriers. This regulatory challenge threatens to delay its international growth strategy, raising concerns about fair competition in the industry.

The Rise of Akasa Air

Since its launch, Akasa Air has pursued an aggressive expansion strategy. The airline, backed by the late investor Rakesh Jhunjhunwala’s family, has rapidly increased its market presence. With a fleet of 27 Boeing 737 Max aircraft and a 4.6% market share as of 2024, Akasa has carved out a niche in the highly competitive Indian aviation sector.

To sustain its growth, the airline has placed a massive order for 199 additional aircraft, scheduled for delivery by 2032. Despite facing supply chain issues affecting Boeing’s delivery timelines, Akasa remains optimistic about its long-term expansion.

Financially, the airline is well-capitalized, though it has not yet provided a specific timeline for profitability. Reports indicate that Akasa has been in discussions with investors, including the family offices of Azim Premji and Ranjan Pai, for a $120 million funding infusion to further strengthen its operations.

Akasa is also planning to expand its route network by adding 5-10 new destinations in the coming year. These additions include a mix of domestic and international routes. However, its push into the international market has been hindered by regulatory challenges, particularly in securing UAE traffic rights.

The UAE Flight Rights Dilemma

Despite its rapid expansion, Akasa Air has struggled to secure approvals for operating flights to the UAE, specifically Abu Dhabi. In an official letter to the Ministry of Civil Aviation, the airline raised concerns about the inequitable distribution of international traffic rights. Akasa claims that newer airlines like itself are at a disadvantage due to existing route allocation policies favoring larger, well-established carriers.

In anticipation of securing UAE flight rights, Akasa had voluntarily relinquished its rights to operate flights to several other international destinations, including Hong Kong, Kenya, Egypt, Ethiopia, Bangladesh, and Nepal. However, despite repeated requests over the past year, the airline has yet to receive approval to commence services to Abu Dhabi.

The primary issue lies in the dominance of IndiGo and Air India, which operate multiple daily flights to key UAE destinations, including Abu Dhabi, Dubai, Sharjah, and Ras Al Khaimah. Akasa Air argues that this creates an uneven playing field, making it difficult for emerging airlines to establish a foothold in vital international markets.

In its plea to the government, Akasa requested approvals for the Winter 2024 or Summer 2025 schedules. If Abu Dhabi slots remained unavailable, the airline proposed an alternative arrangement for flights to Sharjah. Akasa assured authorities that it would immediately utilize any allocated rights to expand connectivity and provide travelers with more competitive airfare options.

Government’s Decision Sparks Controversy

A turning point came on January 15, 2025, when Akasa Air participated in a consultative meeting with the Ministry of Civil Aviation. The airline learned that Abu Dhabi flight rights had already been redistributed to other emirates, including Sharjah and Ras Al Khaimah. Moreover, these rights were allocated to competing Indian airlines, intensifying Akasa’s frustration.

Akasa Air has since questioned the legality and fairness of this decision, arguing that newer entrants deserve equal opportunities in route allocations. The airline continues to press for policy changes that would foster a more balanced competitive environment.

What’s Next for Akasa Air?

Despite regulatory setbacks, Akasa Air remains steadfast in its growth ambitions. The airline is set to launch direct flights to Abu Dhabi from Ahmedabad and Bengaluru starting March 1, 2025. This move follows its successful launch of a Mumbai-Abu Dhabi route, which currently operates daily.

However, the broader issue of fair competition in India’s aviation sector remains unresolved. The challenges faced by Akasa Air highlight the hurdles new airlines encounter when attempting to expand internationally. If current policies continue to favor industry giants like IndiGo and the Tata Group’s airlines, the market risks evolving into a duopoly, limiting options for passengers and restricting competition.

For now, Akasa Air’s struggle serves as a crucial test for India’s aviation regulatory framework. The government’s approach to resolving these disputes will determine whether emerging carriers can thrive in the international market or remain sidelined by dominant industry players.

With a strong financial foundation, a growing fleet, and an unwavering commitment to expansion, Akasa Air is determined to establish itself as a formidable competitor. However, the resolution of the UAE traffic rights issue will be a pivotal factor in shaping its future on the global stage.

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