Extra flying rights, but with caveats
Govt wants to encourage point-to-point traffic on int’l front
India is keen to grant airlines more flying rights for so-called point-to-point traffic, civil aviation minister Jyotiraditya Scindia said, as the country pursues its ambition to build its own aviation hubs.
Under the hub-and-spoke model, airlines deliver passengers from spoke airports to a hub from where they are flown out to other hubs. From these other hubs, they travel further to their final destinations.
For example, up to 70% of Indians boarding an Emirates flight fly beyond the airline’s Dubai hub to destinations in Europe, Americas and other parts of the globe; the balance 30% Dubai-bound travellers makes up the point-to-point traffic. India has been concerned that foreign airlines have been scooping up Indian travellers using this model.
Point-to-point flights, on the other hand, focus solely on origin and destination airports. This would allow airlines—and flyers—to travel directly between specific Indian and global destinations rather than taking a stopover.
“I am more than happy for any country to come in and get point-topoint traffic beyond five-six hours’ flying radius; I welcome it. It is not only for Indian carriers, it is also for international carriers —why should you not be able to fly directly to Europe or to the US?” Scindia said.
Countries like the UAE, Qatar, Turkey, Singapore and Malaysia have frequently requested India for more flying rights. However, New Delhi is not in favour of granting more flying rights for countries that have built aviation hubs by sourcing traffic from India. Any increase in foreign flying rights on the hub-andspoke model might make things difficult for Indian carriers that are starting to expand globally on the back of record orders.
The government’s focus is on increasing flying rights only in pointto-point traffic, a strategy that Indian carriers like Air India that have international expansion plans have welcomed.
by Nicolás Maduro. Following this, the US treasury department temporarily authorized “all transactions prohibited by the Venezuela Sanctions Regulations, 31 CFR part 591 (the VSR), related to oil and gas sector operations in Venezuela, including transactions with PdVSA, subject to certain conditions.”
The authorization suspended sanctions covering most oil and gas sector operations in Venezuela, including energy sales to the US and others, as well as the payment of taxes, royalties, costs, fees, dividends and profits related to oil and gas sector operations or transactions involving PdVSA.
Queries emailed to the spokespersons of India’s ministries of petroleum & natural gas and external affairs on Thursday remained unanswered. While a PdVSA spokesperson couldn’t be contacted, queries emailed to the Venezuelan embassy in New Delhi on Tuesday were unanswered till press time.
“We are trying to secure oil cargoes in lieu of these stuck dividends. Venezuelan oil is back only for six months with a lot of caveats. Also, they don’t have the capacity to rapidly ramp up production,” one of the two people cited above said on condition of anonymity.
Analysts concur with this assessment. S&P Global Commodity Insights in a note post the easing of US sanctions said “it expects little change in
Venezuelan oil production capacity in the next six months, as PdVSA has little to no investment capital and much of the oil-related infrastructure is in a poor state of repair.”
“Venezuela’s current capacity lies between 800,000-850,000 b/d (barrels per day), with current production sitting around 750,000 b/d,” the S&P report said and added, “India used to be a regular buyer of Venezuelan crude oil grades prior to the imposition of US sanctions. During the pre-sanctions period from 2017 to 2019, India imported approximately 300,000 b/d of Venezuelan crude grades, with private refiners like Reliance Industries being the key buyers.”
OVL also owns 11% in Venezuela’s Carabobo Project 1, where Indian Oil Corp. Ltd and Oil India Ltd own 3.5% each, with PdVSA and Spanish energy major Repsol holding 71% and 11%, respectively.
OVL has been investing in overseas oil and gas assets as part of India’s energy security strategy. The overall investment by state-owned companies in oil and gas assets abroad stands at $36.555 billion across 55 assets in 25 countries.