Civil aviation ministry mulls unique British Airways franchise plan for Indian market
15 Sep 2008
After striking up merger proposals with American Airlines in the US, Iberia in Europe and throwing its hat into the ring for several other European carriers, including Brussels Airlines and Austrian Airlines, UK flag carrier British Airways (BA) is turning its gaze to the Indian sub-continent and offering a unique solution to domestic carriers in India, including Go Air, for a franchise arrangement.
Indian civil aviation secretary, Ashok Chawla, is quoted as saying that aviation ministry officials will meet with BA executives today to examine the carrier's proposal. The arrangement will allow an Indian carrier to use the BA livery, brand and flight code, but operate under its own management.
While such an arrangement would allow BA to extend its network within India without having to make an investment, crucially, it would also circumvent the country's Foreign Direct Investment Policy, which prevents foreign carriers from owning equity in Indian airlines.
This case also intrigues as the Indian government has no guidelines on franchising arrangements.
India is a critical market for BA as the country is the UK carrier's second biggest market after the US in terms of passenger volumes.
