Indian low-cost carrier SpiceJet, which has expanded its distribution network by appointing Sharaf Travel as its general sales agency in the UAE, could soon start flying to Dubai, according to an analyst.
Sandeep Shenoy, a strategist at Pinc Research in Mumbai, told Emirates Business that SpiceJet was likely to launch routes to the Gulf as its first move into the international market.
"It would make sense for the airline to fly on cost-competitive routes such as Kerala-Dubai rather than the likes of London or Singapore," he said.
Last month SpiceJet CEO Sanjay Aggarwal said the company was studying routes in which market bilaterals were available and planned to launch international services.
SpiceJet operates more than 125 daily domestic flights to 18 cities. It will fulfil the Indian Government's eligibility criteria for expanding overseas by completing five years of domestic operations on May 23, 2010.
In 2005, Istithmar, the UAE-based investment house, invested $50 million (Dh183.65m) in SpiceJet's Foreign Currency Convertible Bonds. The bonds are due for conversion in December 2010.
Senior travel company executives believe many of India's tier-two cities have potential for international business and leisure travel, and carriers such as SpiceJet would target these passengers. Sharaf Travel, which represents many international carriers in the UAE and Oman, has been appointed SpiceJet's first general sales agency with immediate effect.
Sharaf will promote, advertise and sell SpiceJet tickets to the UAE customers under an exclusive agreement.
Salah Sharaf, Chairman, Sharaf Travel, said: "We are very happy with this partnership and expect to meet the growing demand of travellers within the country."
Travel company executives said that the profile of the passengers out of India to the Gulf has changed over the years. Initially the majority of the travel was labour traffic. Now there are more families and white-collared workers, said the executive.
Samyukth Sridharan, SpiceJet's Chief Commercial Officer, said: "With this step we begin to expand our distribution footprint to Dubai and make SpiceJet tickets available through travel agents to people living overseas."
Though demand is currently low, many Indian carriers are waiting for the right time to start international operations. Indigo, another Indian airline, has appointed Al Rais Travel as its agent in the UAE and plans to add Gulf routes to its network.
Besides Air India, Jet Airways is already connecting Dubai to more than one destination in India. Jet Airways started operations to Dubai in August 2008. Recently, Jet Airways started operations to the southern Indian city of Hyderabad. The airline flies twice daily from Mumbai and one flight daily from Delhi and Chennai. Kingfisher has also started flying from Bangalore to Dubai from June.
Indian carriers such as Jet and Kingfisher are also selling their network in the Gulf, as many of the passengers have to travel onwards to smaller metros and tier 2/3 towns. Kingfisher, for instance, offers a convenient connection from its hub in Bangalore to Hubli, a smaller town.
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