Domestic Economy

Iran in Talks to Establish Direct Canada Flights

Negotiations with the Canadian carrier come, as many European companies have already launched direct flights to Tehran
Air Canada is the flag carrier and the largest airline of the North American country.
Air Canada is the flag carrier and the largest airline of the North American country.
If the flight is established, it will be a major development in ties with the North American country that has little diplomatic and trade relations with Iran

Iran is in talks with Canadian flag carrier Air Canada to establish a direct flight between Montreal and Tehran’s Imam Khomeini International Airport, an IKIA board member said.

“Negotiations are underway with Air India, Korean Airline and Air Canada to establish new flights to Imam Khomeini Airport,” IRNA also quoted Kourosh Fattahi.

Fattahi was speaking during a ceremony to launch Thai Airways’ first direct flight to the Islamic Republic on Saturday.

Currently, Iranian passengers willing to travel to Canada by air usually fly to European hubs like Frankfurt Airport before heading for Canadian cities such as Montreal.

The official did not elaborate on details of the negotiations with the Canadian airline, which is the largest airline of that country. But, if established, this will be a major development in ties with the North American country that has little diplomatic and trade relations with Iran.

In February, Canada officially lifted some of its sanctions against Iran, including a blanket ban on imports and exports, and said it would take gradual steps to reestablish diplomatic relations with Tehran, which were severed in 2012.

Foreign Minister Stephane Dion said restrictions on financial services and trade with Iran would be eased, better positioning Canadian companies to compete globally.

Dion said a number of Canadian sectors would benefit from the move, including the aerospace, transport, agriculture, extraction, petrochemical and oil and gas industries. The US and European Union both eased sanctions against Iran on January 15, after Tehran implemented key restrictions in its nuclear program.

Canada’s exports to Iran peaked at $556 million in 1997 but declined to $48 million in 2014, comprising mostly food products that were exempt from sanctions.

Iran exported $19.8 million worth of goods to Canada in the last Iranian year (March 2015-16), recording a 23% increase over the previous year. Last year’s imports from the country stood at $64.8 million, dropping 29% over the preceding year, according to the Islamic Republic of Iran Customs Administration.

The latest trade data show bilateral trade is on the growth path.

The Islamic Republic exported some 2,400 tons of non-oil goods, including pistachios, dates and carpets, worth $6.2 million to Canada in the first four months of the current Iranian year (started March 20), which indicates a 77% growth over the similar period of a year before.

Also, during the period, more than 6,000 tons of goods, including beans, fertilizers, pharmaceuticals and medical equipment, valued at $18.8 million were imported from the country, posting a 46% year-on-year rise.

Canadian companies complain they are lagging behind in competition with other international businesses, which rushed to Iran after Tehran clinched a landmark deal with world powers to resolve its nuclear dispute in July 2015.

The aviation sector is one of the fields the Canadian government hopes it will benefit from in the opened-up Iranian economy.

Montreal-based plane manufacturer Bombardier Inc. is keen to join other aircraft-manufacturing brands to supply planes to renovate Iran’s aging civil aircraft fleet.

Iran Civil Aviation Organization has said the country needs more than 500 planes during the next decade to meet its pent-up demand.

After the relaxation of international embargoes, French planemaker Airbus, US aircraft giant Boeing and French-Italian manufacture of regional jets ART have clinched deals to sell a total of some 250 jetliners to Iran.

Negotiations with Air Canada come, as many European companies have already launched direct flights to Tehran.

“Currently, 56 international airline companies operate flights to IKIA. Airlines operate flights from the airport to 70 overseas destinations,” Fattahi said during the Saturday ceremony.

  Thai Airways Lands in Tehran

Thai Airways’ newly-launched flight was the latest in the cards. The airline’s plane landed in Tehran at 19:00 p.m. on Saturday.

The flag carrier’s launch of four flights per week is projected to double the number of Iranian arrivals to Thailand this year to nearly 200,000 and multiply Thai visitors to the Islamic Republic, currently numbering in the thousands.

Iranian visitors to Thailand grew by 20% to 88,000 last year, a figure that was set to grow to 120,000 this year prior to THAI’s decision to launch its Tehran service.

“We should see a surge in traffic volume this year, as Bangkok and Tehran are better connected,” said Sunanta Wuthisakul, chief executive of Thai Orchid Tour and Holiday Company, a Bangkok-based travel agent that has long specialized in arranging tours to Iran.

The presence of THAI, a well-established airline with a good international image and safety track record, is set to encourage greater travel on both ends, she told the Bangkok Post.

THAI is providing a third option for non-stop flights between the Thai and Iranian capital, joining long-haul low-cost carrier Thai AirAsia X (TAAX) and Tehran-based Mahan Airlines, whose safety and service images are perceived as falling below international standards.

The airline is operating a Boeing 777-200 jet configured with 309 seats on the route, adding a sizable increase in capacity.

TAAX, which started offering non-stop Tehran service on June 22 with three flights a week, operates an Airbus 330-300 with 370 seats on the route.

Mahan Air alternates between a single-aisle Airbus 310-300 (202 seats) and a wide-body Airbus 340-300 (215 seats), with four flights per week.

The lifting of sanctions against Iran in January has turned Tehran into a new economic frontier and an emerging tourism market, thus catching the attention of international airlines.

Early September, British Airways resumed direct flights to Tehran—the first UK carrier to fly to Iran in four years. Six return flights per week now operate between London’s Heathrow and Tehran, which BA described as “an important destination”.

KLM has also said it will resume service to Tehran from October 30. Tehran will be the 14th new destination the flag carrier airline of the Netherlands has added to its network in 2016. Four weekly services will be operated between Schiphol and Tehran, supplementing the Paris-Tehran service operated by Air France since April 16, 2016, after a seven-year hiatus.

Austria’s national carrier Austrian Airlines also started flying three times a week to the Iranian commercial center of Isfahan on September 4. The airline operates an Airbus A320 to the famous Iranian tourist hub located 4,200 kilometers from Vienna on Wednesdays, Fridays and Sundays.

Austrian Airlines has expanded its existing portfolio of up to 14 weekly flights to Tehran by adding Isfahan, thus increasing its services to Iran to 17 flights each week.


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