|India likely to reject EU carbon trading plan|
No official go-ahead yet in the wake of China's move to bar its airlines from participating in anti-emission scheme.
Last Modified: 20 Mar 2012 00:18
China in February barred its airlines from participating in the European scheme, which is meant to reduce emissions.
The Indian official, with direct knowledge of talks between the EU and other countries on the issue, told Reuters news agency that India will soon ask local airlines not to share emissions data with the bloc or buy any carbon credits.
If the EU retaliates by suspending Indian airlines from flying to Europe, India would make similar moves and consider charging an "unreasonable" amount for flying over India, the official said on Monday.
"We have lots of measures to take if the EU does not go back on its demands. We have the power of the economy, we are not bleeding as they are," the government official said, adding that Europe's position would harm its own economy and airlines.
Indian government is awaiting formal approvals from several ministries to implement the order to airlines, which it expects soon, the official said.
"The questions is, are you (EU) provoking the world into a trade war?" the official said.
Last week, China suspended the purchase of 10 more Airbus jets, raising the stakes in the row.
India does not yet plan to ask airlines to cancel Airbus purchases, but that is a possibility if the dispute escalates, the Indian official said.
Amber Dubey, director for aviation at global consultancy KPMG, said India is in the midst of a huge increase in the size of both its civilian and defence fleets, with a significant share of the orders coming from European suppliers.
"The EU-ETS (emissions trading scheme) issue is escalating fears of a trade war between EU and the rest of the world. There is a chance that the government may decide to use these large aircraft orders as a negotiating tool", Dubey said.