NEW DELHI :Cathay Pacific Airways Ltd is targeting air freight contracts from large multinationals such as Apple Inc. and Foxconn that are expanding manufacturing in India, a top official at the Hong Kong-based airline said.

“We are already significant carriers for these companies through their forwarders out of the southern part of China. So, there is no reason to believe that we will not have that here in the future,” said Tom Owen, the director of cargo at Cathay Pacific, one of the world’s top air cargo operators.

In India, Cathay Pacific is among the top four cargo carriers. In the June quarter, the airline came fourth in terms of air freight carried to and from India at 28,531 tonnes after Emirates, Qatar Airways and Aerologic. Air India stood at the fifth position with 26,023 tonnes

While airlines globally pivoted to cargo business as passenger traffic thinned out during the pandemic, Cathay believes cargo business is a long-term bet.

“Cargo business ultimately is very much based on long-term returns and although you can make money in the short term, you can also lose a lot of money in the short term as well. I think you need to have a long-term plan, investment plan; you need to have a long-term view on fleet, size, scope, network and infrastructure,” he said.

India will need the support of foreign cargo airlines to achieve the full potential of its export aspirations, he added.

“I think ultimately, you need a combination; India is not going to be able… I don’t think survive in terms of its export aspirations without both its own strength but also allowing freight to be carried by freighters from overseas and that sort of combination, that balance is what I suppose the government has to work out and get right,” he said.

Currently, Cathay Pacific is in a rebuilding phase having achieved 65% of its pre-covid levels in passenger segment and is back to 85% pre-covid operations in terms of cargo. Travel to Hong Kong was largely restricted in the last three years due to strict covid-related rules. The curbs were eased since early 2023. Cathay Pacific, which used to fly about 100,000 passengers daily, saw traffic fall to just around 50 passengers on some days during the covid period.

“Hong Kong relies on international free flow of traffic in and out. There’s no domestic market. So, when you shut down the borders, our passenger airline essentially went down to about 2-3% of its normal capacity. So, I think for us, cargo was a very important part of coming through the 2.5 years in terms of cash flow to the airline, which reduced our need to borrow; it reduced our need to sell stuff, help the airline to get through with that, along with cost cutting and everything else,” Owen said.

The airline operates 18-20 cargo flights a week to Delhi, Mumbai and Chennai. It also uses the belly space of its 23 passenger flights per week to India to carry cargo.

India is the third-biggest cargo market for Cathay Pacific after the US and China, and the airline aims to grow it further. It plans to expand cargo operations to Kolkata, Hyderabad and Bengaluru given the growth potential of e-commerce, pharmaceutical industry and fresh produce.

“The existing story of pharmaceuticals is obviously very positive, and I think it has got a long way to go still in terms of growth and development. We are also pretty excited around the investment that has been going on in information technology, electronics. I think the third interesting area for us is working with some of the e-commerce players, but not just e-commerce players but also things like the Indian Post Office and others around moving mail out of India to the Indian diaspora,” Owen said.

“The question is, we need to get a bit more access into some of the other places apart from the three big metros that we currently have,” he added.

With the Indian government planning to boost the cargo handling capacity of homegrown carriers to 10 million tonnes by 2030 from the current 3.2 million tonnes, Cathay reiterated there is opportunity for everyone in the Indian market.

“I think there will be enough air freight coming into and out of India to justify both domestic expansion of Indian assets, Indian aircraft, as well as foreign carriers flying here, carrying Indian exports, supporting the Indian economy,” Owen said.

As covid-related restrictions are eased and passenger flights rebound, the global cargo business has taken a backseat. In addition, the impact of the Russia-Ukraine war and inflationary pressures in Europe and the US are also acting as a dampener to market sentiment but Cathay Pacific is hopeful of improvement over the next 6-12 months.