bilateral talks between india and china on air services agreement

Thursday, March 17, 2005

Two-days bilateral air services talks between India and China concluded here today. The last round of talks was held in May 1997 and the current round was being held after a lapse of nearly eight years. The talks were held in a friendly and cordial atmosphere.

It was noted by both sides that the necessity to enhance civil aviation services between India and China had assumed great significance in view of the rapidly expanding trade and tourism links between the two countries as well as the sustained growth of both economies. For instance, India's bilateral trade with China had increased over 80% during the first 11 months of 2004 to cross US $ 12 billion. Business activities were showing an appreciable upward trend as more and more operations both by Indian and Chinese companies were taking place in each other's territories. Participation in trade exhibitions in China had also become extremely popular with the Indian business fraternity.

In this context, the absence of adequate direct air connectivity between the two nations was proving to be a major constraint in developing and sustaining the growing traffic in passengers andmovement of cargo. It was observed that due to lack of sufficient direct connectivity, business travellers and tourists were forced to travel through third countries. The two sides also noted that both countries had taken a number of policy initiatives and significantly liberalised the civil aviation sector in the recent past so as to keep pace with the overall economic growth and development.

In this background, both sides agreed to consider significant enhancement of traffic rights from the present level of seven flights per week, in order to facilitate operations of more services between the two countries in accordance with the demand. There was also a need to increase the points of call in both countries, which are presently restricted to two destinations as well as the number of intermediate and beyond points. The restriction of dual designation of airlines for operations between India and China would be reviewed, so as to provide for multiple designations. It was further agreed to also review other issues like liberalisation of code share rights and cargo services and operations by dry leased aircraft to meet the demand for greater connectivity.

Following the progress made in the current round of talks and the broad consensus reached, a formal agreement spelling out the details on the various issues is likely to be finalised and signed during the ensuing visit of a high level Chinese delegation to India shortly.

The Indian side was led by Mr. Ajay Prasad, Secretary, Ministry of Civil Aviation while the Chinese delegation was led by Mr. Yang Guoqing, Vice-Minister, General Administration of Civil Aviation of China.

MC:CP:civilaviation17.3