India’s Airline Brands Connecting Kathmandu

The Nepali sky has witnessed an increasing traffic from airline companies of India connecting India to Nepal.

It was in the early 20th century when countries embraced air transport as a means to travel from one part of the world to another. India was one of the first countries in Asia and in the world to opt for civil aviation. Tata Airlines, which started its services in 1932, became a public limited company in 1946 under the name Air India. After acquiring 49 percent shares of the airline, the Government of India granted it the permission to operate international services as the designated national flag carrier.

Nepal’s civil aviation industry started after the national flag carrier, the Royal Nepal Airlines Corporation (RNAC) was established in 1958. The RNAC, which was renamed as the Nepal Airlines Corporation (NAC) a few years ago, began its services by flying to a few domestic destinations. Later, its services were extended to such Indian cities as Patna, Calcutta and Delhi. Hence nationals of both India and Nepal have had an opportunity to fly to each other’s country for a few decades now. Over the past decade, however, the Nepali sky has witnessed an increasing traffic of Indian Airlines connecting India to Nepal.

At present, there are four Indian airline brands connecting India to Kathmandu. They are: Air India, Indigo, Spice Jet and Jet Airways. All of them are Low Cost Carriers (LCCs).

Air India is India’s national flag carrier and a part the Air India Limited (AIL), a company owned by the Government of India. Air India Express is the airline’s international low-cost subsidiary established in 2005. At present, Air India flies to and from 27 international destinations in 19 countries including Nepal. It operates 18 scheduled flights to Kathmandu per week, including two flights from New Delhi daily, and four flights from Kolkata per week. It also operates scheduled passenger services, mainly to the Persian Gulf and South East Asia. At present, Air India Express (AIE) has a fleet of 21 aircraft. These aircraft have around 180 seats each and offer budget travel. AIE gives its passengers all essential on-board services needed for a comfortable flight. Passengers can also avail themselves of free standardised meals and limited on-board entertainment.

IndiGo is a popular, private, and low-cost airline established in August 2006. IndiGo has grown faster than any other LCCs in South Asia because of its efficient operations and low fares. In order to maintain the fares low, IndiGo’s flights offer only economy class seating, a complimentary mineral water, and no in-flight entertainment and allow only one free check-in baggage. On IndiGo flights, snacks, meals and drinks are available as buy-on-board options. IndiGo operates flights to five international destinations - Bangkok, Dubai, Kathmandu, Muscat and Singapore.

IndiGO started flying to Nepal in October 2012. At present, it operates seven flights connecting Delhi to Kathmandu per week. Its fares start from NPR 8,420. The company plans to increase the number of flights to its existing destinations and start flying to new destinations in Nepal. IndiGo flights have an average occupancy of 99 percent. Schemes are not an attraction for this airline because, according to the company, passengers prefer low-cost fares to schemes as the latter often come with a string of terms and conditions attached to them.

SpiceJet is a low-cost airline which began its services in May 2005. It has a share of 19 percent in the Indian market at present. SpiceJet flies to 32 domestic destinations and makes two international flights -- to Colombo and Kathmandu. SpiceJet sent its first flight to Nepal in October 2010. The airline currently operates 11 flights connecting Kathmandu per week. In the peak season, however, it has two flights a day. With starting fares of NPR 3,400 (one way) and NPR 8,000 (round trip), it offers only the economy class travel. This airline has average flight occupancy of 85 percent. SpiceJet provides sandwiches, cookies, flavored nuts, soft drinks and juices as buy-on-board options. The passengers also get complimentary mineral water.

Jet Airways currently operates a fleet of 99 aircraft, which include 10 Boeing 777-300 ER aircraft, 11 Airbus A330-200 aircraft, 60 Next Generation Boeing 737-700/800/900 aircraft, and 18 modern ATR 72-500 turboprop aircraft.

With an average fleet age of 6.06 years, the airline has one of the youngest fleets in the world. Jet Airways flights to 73 destinations span in India and beyond. The company launched its first flight to Kathmandu on 14th May 2004. It operates 21 flights per week with two daily flights from Kathmandu to New Delhi and one daily flight from Kathmandu to Mumbai. Inclusive of all taxes, Jet Airways’ fare from Kathmandu to Delhi is USD 130 (one way) and from Kathmandu to Mumbai is USD 260 (one way). Jet Airways operates with two travel classes - Premiere and Economy - on the Kathmandu-India sector where it has average occupancy of 90 per cent. Jet Airways offers connectivity to its international and domestic network via Mumbai and Delhi.

Delhi seems to be the most popular destination for the Indian flights that fly out of Kathmandu, because of its close proximity to all the major Indian cities. However, other Indian cities like Mumbai, Kolkata, Bangalore, Goa, Chennai and Varanasi are also on demand. Bangalore is mostly on demand because of the education opportunities it provides to Nepali students. Tourism continues to be a major factor behind the increasing air traffic between the two countries. However, Indian nationals also visit Nepal and vice versa for health, business, and religious purposes.

Market competition increases when more airlines start flying to the same destinations. This competition compels the airlines to lower their fares, causing a decrease in their revenue. This is why the airline brands flying to Kathmandu have a tough competition among themselves. “The competition is tough but it also has to be healthy,” says Joy Dewan, GSA, SpiceJet.

There are a few problems that the Indian airlines also have to face in Nepal. “The increasing fuel costs add to the overall high cost of operation, which naturally impacts the airline’s bottom line,” points out Samir Chada, Country Manager, Jet Airways, as a major problem for Jet Airways and other airlines currently flying to Nepal. Similarly Dewan sees high ground handling charges for navigation and landing as the major problems. Airlines have requested the airport authorities to reduce the charges. The authorities are expected to consider the demand positively. Similarly, the lack of enough space at Nepal’s only international airport and the lack of opportunity for night flights are the other problems that the Indian airlines have been facing.