US-Abu Dhabi pact behind Jet's push for bilateral seats

Business

A pact signed by the US and Abu Dhabi in April this year to establish a base in the emirate for US Customs and Border Protection agents to screen passengers on US-bound flights is emerging as the key reason why Jet Airways sought a three-fold increase in seats entitlements, coinciding with its partnership discussions with Etihad Airways.

The development also seems to be the compelling reason for Jet to plan a shift from Brussels to Abu Dhabi as its hub for international operations after the announcement of a 24 per cent stake sale to Etihad in April.

Abu Dhabi expects to open the facility to clear passengers for US customs and immigration in December, a post that would support Etihad's expansion as an international carrier. Under the agreement, the US Customs and Border Protection officers will operate a pre-clearance checkpoint at the Abu Dhabi International Airport and flights from Abu Dhabi to the US will land at domestic terminals, without the need for further immigration and customs checks. Passengers could deplane and exit US airports simply like domestic travellers.

According to senior finance ministry officials involved in the discussions, an increase in bilateral seat entitlements was not part of the initial discussions over a stake sale by Jet Airways.

The increase in bilateral air traffic entitlements has become a controversial issue with several Members of Parliament linking the Jet-Etihad deal to increase in bilateral entitlements. Jet Airways announced the sale of 24 per cent stake to Etihad for Rs 2,060 crore on the same day the increase in bilateral traffic rights was announced.

The concerns raised have prompted Prime Minister Manmohan Singh to ask the civil aviation ministry to get a post facto Cabinet nod for increase in bilateral traffic rights.

Meanwhile, the civil aviation ministry has set aside fears about potential security concerns arising out of the Jet-Etihad deal, claiming that no fresh amendments have been made with respect to the security clause in the existing bilateral air traffic agreement between India and Abu Dhabi.

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