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Mumbai: Dubai-based airline Emirates, jocularly called the national airline of India in aviation circles because of its domination of the international traffic to and from India, has finally ceded the throne to Naresh Goyal’s Jet Airways (India) Ltd.

The reasons: not enough additional flying rights for Emirates; Jet Airways’ overseas advantage from its tie-up with Etihad Airways PJSC, which, in 2013, bought a 24% stake in the Indian airline.

According to aviation consulting firm Capa India, Jet Airways carried 6,350,401 international passengers in the year ended 31 March, while Air India came second with 6,231,271. Emirates was at No. 3, carrying 5,085,213 passengers to and out of India.

Qatar Airways Co. QCSC and Etihad Airways were at fourth and fifth spots, with 2,030,918 and 1,694,455 international passengers, respectively.

India did not allot any additional flying rights—called bilaterals—to Dubai in the last fiscal year, preventing Emirates from scaling up India services.

And, thanks to its tie-up with Etihad, Jet Airways can operate on international routes more easily through the former’s Abu Dhabi hub.

For both Emirates and Etihad, the largest market is India.

“Jet Airways’ aggressive international expansion, largely driven by the Abu Dhabi hub over last 12-18 months, has logically pushed it to No. 1 airline status as the...airline accounted for close to 75% of the incremental international traffic carried by Indian airlines in financial year 2015," said Kapil Kaul, chief executive officer (South Asia), Capa India.

Kaul said that except 11,000 additional seats allowed in fiscal year 2014, Emirates is facing capacity challenges from India since 2008, with its planes flying at 90% seat occupancy.

“I don’t expect any further bilateral rights to Emirates or any other Middle East carrier, at least, in the near term, till a structured bilateral policy is formulated by the government, and this means Emirates will remain at No. 3," said Kaul.

According to a Jet Airways spokesperson, the airline operates 128 international frequencies (flights to and from India) per day. In addition, Etihad operates 45 frequencies per day out of India, he said.

Emirates declined to comment for this story. At present, the airlines operates 185 flights a week to 10 Indian destinations.

A Jet Airways spokesperson refused to comment on the airline achieving the No. 1 status, but pointed to its strengths, such as a wide network, strategic partner (read Etihad), code-share partners, hubs in Delhi and Mumbai, and gateway points in Abu Dhabi, Brussels, London Heathrow and Paris.

When asked what the increase in international flight operations means to the airline, the spokesperson said it translates into seamless connectivity, and easier access for business and leisure travellers.

Tim Clark, president of Emirates, told Mint in October 2012 that with more than 800,000 Indians living in Dubai, the significance of India for business and leisure travel to Dubai and beyond was clear.

“We could easily fill 100,000 seats per week in each direction. By not allowing more capacity, travel and trade for all Indians is being compromised, which doesn’t allow the economy to reach its potential," said Clark.

Air India, the national airline, is surviving on a 30,000 crore government bailout. The airline, which had total debt of 40,000 crore as on 31 March, is expected to turn around only by 2018-19.

On 16 June, Mint reported that alarmed by Gulf airlines carving out a large slice of the lucrative India-US air traffic, American Airlines Inc., United Airlines Inc. and Delta Air Lines Inc. had teamed up to protect their turf.

The three airlines on 5 March alleged that Dubai, Abu Dhabi and Qatar collectively lavish subsidies worth $42 billion (around 2.7 trillion today) on the airlines they own—Emirates, Etihad Airways and Qatar Airways, respectively—tilting the playing field in their favour.

At the core of the squabble is the so-called sixth freedom traffic. Essentially, sixth freedom is an airline’s right to fly from one foreign country to another, stopping mid-way at its home base for non-technical reasons. For example, when British Airways Plc flies from India to the US via London, it is protected by the sixth freedom right.

Capa expects growth of around 8-10% in international and close to 15% in domestic traffic this fiscal year.

This would result in international traffic increasing to 54-55 million and domestic traffic to around 80 million, it said in a June report.

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