Finally, the alliance between the country's two largest private carriers, Jet Airways and Kingfisher Airlines, took off on 1st July, following an eight-month delay. On the condition of keeping his name anonymous, a senior Kingfisher Airlines official said: "To start with, both the airlines have started sharing infrastructure at the domestic airports that include Delhi and Mumbai."

This month would also see the commencement of the code sharing between the two airlines, other than initiation of infrastructure sharing at airports. The official added: "The infrastructure and code sharing will reduce Kingfisher's operational costs by 20-30%." It has been learnt that soon the code sharing on domestic and international flights will commence, apart from joint fuel management and network rationalization.

An agreement was signed last October, by Vijay Mallya and Naresh Goyal, with the aim to enormously rationalize capacity and reduce costs at a time when prices of jet fuel had hit record highs. An analyst with a domestic brokerage firm, said: "Landing and parking charges are high in India.

Besides, jetfuel prices have moved upwards in the last two months. All this has forced Kingfisher and Jet to look for ways to reduce costs." It should be noted that due to being in the red, both the airlines have a large debt component on their books. The debt for Jet is $3.1 billion, and had a standalone net loss of Rs 402 crore for FY09. The loss for Kingfisher stood at Rs 626 crore in the third quarter of FY09, from Rs 423 crore for the same quarter of FY08.

Raajeev Batra, head of transport advisory services, KPMG, said: "The airline business in India in terms of profitability faces an uphill task due to high charges that are paid out for operations." The aviation industry suffered losses of around Rs 10,000 crore for FY09.