does anyone think that AI or IC will be given first rights refusal on routes before they are offered to the private airlines
/IC already have de-facto right of refusal on routes now. If the frequencies are dormant, then they are not using them. Once they open it up to private carriers, it has to be completely open. No preference, no interference, nothing.
the main point they are missing (AI pilots/unions and everyone) is that the market is going to walk away anyway
Actually Nikhil, it is you that is missing the point. AI
has absolutely no objection to competition from private airlines. AI
actually faces direct competition (defined as 10% elapsed time differential) on ~98% of its ASMs, the only routes without competition being Dar-Es-Salaam and Al-Ain.
Air India's market share of O&D international traffic (FY2003-4 figures) is just above 18%, with another 7% to Indian Airlines, 1% to Jet/Sahara and the remaining 74% to foreign carriers. IC
's domestic market share is now in the 41% range, with 44% to Jet Airways, 10% to Sahara, 4% to Air India and 1% to others. Hardly indicative of an airline environment without competition.
However, "competition" only truly exists in an open market. As long as artificially imposed constraints exist via bilateral capacity limits (and that alas is a fact of doing international flying anywhere in the world) there is only a finite sized pie to carve up. Rather than hand the pie to someone else to eat because it is too large for Air India to eat in one bite, simply give Air India the tools to cut it. Then everyone can get a slice. Forcing Air India to eat the pie with its hands tied behind its back simply makes a mess of the pie for everyone concerned. In fact, you'll wind up with pie in your face! Liberalize bilaterals first (via open skies agreements such as are in place with the SAARC countries and some ASEAN countries) and then make operating rights available to any qualified airline. But hey, thats the logical way to do it. Better to just get into a frenzy and jump to premature decisions to suit Naresh Goyal's pocket instead.
And finally, before people start getting too excited, let see just where does India have this dormant undesignated bilateral capacity available to that the media keeps crowing about. The answer might surprise you (Source : DGCA).
I'm sure we'll see some Kolkata-Pyongyang nonstops once Jet Airways is given international authority. And the Indian community in Lesotho must be chuffed now that Maseru will be connected to Sahara's "Hub Hyderabad". After all, the media believes that private airlines are the solution to everyone's problems right?
"The A340-300 may boast a long range, but the A340 is underpowered" -- Robert Milton, CEO - Air Canada