The Telegraph
Since 1st March, 1999
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Fly foreign, dirt cheap

New Delhi, March 18: A dogfight is building up in the airspace out of India. Newly-launched budget airline Air-India Express and domestic player Air Sahara today announced low starting fares for flights to Gulf and Southeast Asia, respectively.

Air-India Express, a low-cost airline started by state-run Air-India, said it would fly Delhi-Abu Dhabi-Delhi at just Rs 6,632 and fly out of Thiruvananthapuram, Kochi and Kozhikhode to Dubai, Muscat and Abu Dhabi at an average one-way fare of just Rs 2,500.

This translates to discounts between 25 and 50 per cent over normal fares being charged by rival airlines. AI Express's fare war is expected to impact rival state-run Indian Airlines, as well as Emirates and Gulf Air.

Air Sahara, the third-largest airline in the country, also announced a Rs 10,000 inaugural economy-class fare on the Delhi-Singapore-Delhi and Chennai-Kuala Lumpur-Chennai routes it will be launching from mid-May. 'Good flight schedule, good service and Indian hospitality would be our themes on these flights,' said Rono Dutta, its chief executive.

The new fares make journeys out of India far more affordable than journeys within the country. A Delhi-Calcutta return economy ticket now costs about Rs 18,000 and Delhi-Mumbai-Delhi about Rs 15,800.

Arch-rival Jet, which has not announced its fares, and Indian Airlines, which will launch daily flights between Delhi and Kuala Lumpur, said: 'We are watching the situation. Let's see how this develops and then we will react to it.'

AI Express's next phase will be connecting Calcutta and Chennai to Singapore and Kuala Lumpur in 2006. The battle for the skies that has started now will then in all probability turn bloodier.

'Air-India Express also proposed to operate flights to Bahrain, Kuwait, Singapore, Kuala Lumpur, Bangkok and Jakarta in the months to come at very competitive rates,' said Air-India chairman V. Thulasidas.

The new rates will force players to reduce the fares they charge now. The lowest return journey economy fares on the Delhi-Singapore route now stand at Rs 16,000 and the top end Singapore price is about Rs 21,000. All this should place some pressure on domestic fares, too.

Air-India Express, with three Boeing 737-800s, will start with 35 flights per week to Dubai, Abu Dhabi, Muscat and Sharjah from Mumbai, Delhi, Kochi, Kozhikhode and Thiruvananthapuram.

The parent Air-India will gradually withdraw many regular flights on these routes.

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