Richard Branson, Chairman of Virgin Atlantic Airways, today expressed his deep disappointment at the failure of the Indian and UK governments to agree to a new air services agreement in talks which broke up on Friday 21 June. Failure to reach agreement at the next round of talks would cast doubt on the future viability of Virgin Atlantic’s London-Delhi service.
Commenting on the talks he said:

“Virgin Atlantic is committed to the London-Delhi route, but is frustrated at the blocks that have been put on our ambitions to expand these services and add new ones to Mumbai. We’re extremely disappointed that the talks ended without a new agreement and hope that the two governments will use the intervening weeks before the next round to reflect on the real benefits a new deal would bring.

“Our current twice weekly service between London and Delhi is not commercially viable and post September 11 we simply cannot afford to make losses on this route for the foreseeable future. We would love to operate more frequent services to Delhi and launch new services to Mumbai - both cities could sustain daily operations. I am writing to both governments to encourage them to agree a new deal allowing more frequencies between our two countries.

“India desperately needs the benefits that additional air services would bring. India has well-established business links with Britain, it is an increasingly popular destination for British tourists and the family ties which bind our two countries together are as strong as ever.

“However, services are woefully inadequate to meet demand. Half of the people flying from London to Delhi and Mumbai each year are forced to do so via third countries. This can extend their journey times by up to five hours. The lack of direct services must also be suppressing demand - I think that with more services twice as many people would fly between our two countries.”

The current air services agreement allows airlines from each country to fly 16 services per week between the UK and India. British Airways (BA) operates all of the UK’s allocation. Air India (AI) currently uses 11 of the frequencies allocated to India. Virgin Atlantic entered a codeshare agreement with AI in December 1999, which allowed it to operate all their unused frequencies. Virgin started operating two flights a week between London and Delhi in July 2000, but the two airlines have so far been unable to agree any increase in capacity above this level.

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