In an interesting move, India’s Jet Airways has joined AACO, the Arab Air Carriers Organization. This is the first carrier outside of the Arab League countries to join AACO, and reflects the increasing importance of trade between the subcontinent and Arab countries. Why would an Indian Airline want to join and Arab Airline association?
AACO has been innovative under the leadership of Abdul-Wahab Teffaha, developing joint distribution products with Amadeus, joint fuel purchasing arrangements, and a number of training programs. Jet could benefit from these and these and other programs currently underway. In addition, Jet could benefit from favorably publicity in the Gulf states and with the Muslim community within India, which is sizable.
With the failing state carrier Air India once again reducing prices and creating fare wars reducing prices to unsustainable levels domestically, Jet needs to focus on its international routes. Cooperation with AACO can help it reduce costs and potentially coordinate schedules to provide connecting service with other carriers to Indian destinations.
This is a bold move for Jet, and one that expands the geographic reach of AACO eastward, and hopefully will be the start of a successful relationship for both entities.
Of course, the geo-political impacts of this move will be carefully watched as well, and open up a whole new line of questions regarding India’s relationship with, and potential growing influence of the Middle East. We’ll let the political pundits discuss that. But from an aviation standpoint, it appears to be an economic win-win.
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