Joint fight

Under new regulations introduced earlier his year, airlines flying to or from Europe have to buy carbon permits under the EU's Emissions Trading System and pay a fine if they exceed a certain limit.

The new law is part of EU efforts to mitigate climate change. The aviation industry accounts for 3 percent of global carbon emissions. Under the new law, the EU could collect some 256 million euros in 2012 - 45 million from India alone.

India and China are vehemently opposed to the new tax. The rivals have joined hands to fight it, just as they have worked together on other occasions such as ahead of the Copenhagen climate summit when they were asked for binding promises to reduce their carbon emissions.

When the decision was made public, Chinese Foreign Ministry spokesman Hong Lei urged the EU authorities "to resolve this issue in a pragmatic and prudent manner."

Meanwhile, Cai Haibo, the deputy secretary-general of the China Air Transport Association, which represents the country's four major airlines, told Reuters that they would "not cooperate on the Emission Trading Scheme and Chinese airlines would not impose surcharges on customers."

India's Environment Minister Jayanthi Natarajan also urged that the decision be immediately reversed. "India strongly feels that a unilateral measure as the one proposed to be taken by EU, stands not only in violation of the principles and provisions of the (international) convention, but will also not augur well for the success of future climate change negotiations," she wrote in a letter to Connie Hedegaard, the EU's commissioner for climate and energy.

She also said that the government had asked airlines such as Air India, Jet Airways and Kingfisher Airlines that fly to Europe to refrain from handing over any carbon emissions data.

Tough for airlines

For Kapil Kaul, CEO of the Center for Asia-Pacific Aviation in New Delhi, the rules will be crippling for airlines that are already in a precarious financial situation. "Cutting out this much money in the current environment will be very tough," he told Deutsche Welle, adding, however, that India's exposure to Europe was not yet that high.

"Jet Airways flies to Brussels and London, and Air India serves a few European destinations, but they are not as aggressive as some Middle Eastern or US carriers." However, he said that operations were expected to grow as more Indians could afford to spend their holidays in Europe, or wanted to expand their business to Europe. The new decision could serve as a deterrent, he said.

Moreover, in his opinion, there are ulterior motives for introducing the tax. "There is no demonstrated proof that the money the EU collects through this tax will be spent on the environment. These are basically measures to increase revenues for European governments that are mostly in a bad state," he said.

He pointed out that Indian aircraft manufacturers were developing new engines and experimenting with alternative fuels to make flying more environment-friendly.

Isaac Valero-Ladron, a spokesperson for Connie Hedegaard, has rejected criticism of the law. "If any country wants to reduce emissions differently, that is fine with us as long as their measures have an equivalent environmental impact," he told news agencies, adding that airlines from these countries could be exempted.

Author: Priya Esselborn (AFP, Reuters)
Editor: Anne Thomas