Lufthansa to invest $10 million to hike share in India tourism
Lufthansa to invest $10 million to hike share in India tourism
NEW DELHI (Reuter): Germany's Lufthansa Airlines, seeking to
increase its hold on India's burgeoning tourist market, will
invest US$10 million to promote the local travel industry, an
airline spokesman said on Saturday.
He said Lufthansa chairman Juergen Weber, who accompanied
German Foreign Minister Klaus Kinkel to New Delhi last week, told
Indian officials the airline saw an increasingly important role
for itself in the domestic market.
Weber, on his second Indian visit in three months, believed
Lufthansa could work with state-owned Air India to increase
tourist inflow from Germany and other European countries.
"A new Indo-German bilateral... would enable us to increase
our flights to India and launch, jointly with Air India, our
Tourism Development Fund to increase the flow of German tourists
to the country," Lufthansa spokesman Kavin Sethi quoted Weber as
saying during his recent visit.
Germany is among the few countries to have been allowed to
bring in more flights. Some 40 countries have requested
additional landing rights in India.
Sethi said Lufthansa had committed $10 million in the
bilateral agreement with Air India to launch the fund to market
India as a tourism destination in Germany.
The fund, to be administered by representatives of the two
carriers and the Indian government, will be created and
maintained from money Lufthansa will pay Air India for ferrying
passengers to and from India.
Sethi said Lufthansa's investments would be stretched over a
five-year period.
Aviation industry sources said the Indian government had asked
Lufthansa to contribute to the fund what would normally have been
Air India's share in the profits.
"But Air India lacks the resources to fly to Germany, not
having enough aircraft," an aviation industry analyst told
Reuters. Sethi declined to comment.
China
Sethi said apart from India, Lufthansa was eying China as
another major booming market.
"No international airline could afford to overlook these two
countries," he said.
Lufthansa began a new flight to Frankfurt from the southern
Indian city of Madras in July and may soon start another to cope
with high passenger traffic.
Weber said the German carrier was also considering a new tie-
up with ModiLuft, one of the four big Indian private airlines.
ModiLuft has a technical and training agreement with Lufthansa.
Its aircraft are on lease from Lufthansa.
ModiLuft is not yet a scheduled airline.
Weber said that once the government decided to ease
restrictions on private airlines, Lufthansa could opt for an
equity stake in ModiLuft. He did not give details.
India allowed private airlines two years ago as part of its
far-reaching economic reforms, but it has yet to accord them the
same status as its state-owned domestic Indian Airlines.
Lufthansa's new bilateral agreement with Air India earlier
this year allows it to increase its weekly flights to 15 from the
present 10. Madras was the first stop the airline chose.
"We have a load factor of 68 percent on our new flight from
Madras, which is more than we expected," Sethi said.