Capital A Signs LOI to Establish Bahrain as Middle East Aviation Hub for Expansion

Capital A Moves to Position Bahrain as a Central Aviation Hub

On November 3, 2025, Capital A Berhad sealed a pivotal Letter of Intent (LOI) with Bahrain's Ministry of Transportation and Telecommunications. This agreement aims to establish Bahrain as AirAsia’s strategic hub in the Middle East, marking a significant step in the group’s global expansion initiative.

This LOI outlines a comprehensive framework for enhanced aviation and economic cooperation between Capital A and the Kingdom of Bahrain. The establishment of this hub represents a vision to create new pathways connecting the Asean region with one of the world's fastest-growing aviation markets. The partnership promises a multifaceted collaboration that covers future airline operations, logistics, cargo, maintenance capabilities, and talent development.

Tony Fernandes, the CEO of Capital A, emphasized the potential impact of this partnership, stating, "This collaboration is a game-changer. Both Capital A and AirAsia are on the verge of completing a significant restructuring, and Bahrain will serve as a powerful launchpad for our initiatives in the Middle East." He highlights AirAsia’s commitment to innovation in transforming low-cost aviation, reiterating the airline’s mission of making air travel accessible to all.

With ambitions to operate over 25 daily flights from Bahrain to various Asean megahubs by 2030, AirAsia aims to welcome over 20 million travelers over the next five years. The proposed flights will not only connect major capitals but also reach emerging and secondary cities, driving economic expansion and opening up fresh avenues for trade, talent, and cargo movement.

H.E. Dr. Shaikh Abdulla bin Ahmed Al Khalifa, the Minister of Transportation and Telecommunications of Bahrain, reflected on the partnership’s potential, stating, "This alliance with Capital A strengthens Bahrain’s standing as a premier tourism and logistics hub in the region, linking Asia, the Middle East, Europe, Africa, and the United States." The partnership is set to create specialized job opportunities for highly educated Bahraini nationals while simultaneously boosting the country's GDP.

In line with the LOI, AirAsia will explore launching flights originating from Malaysia, Thailand, the Philippines, and Indonesia to Bahrain within five years. It also plans to establish a Bahrain-based Air Operators Certificate (AOC) to operate narrowbody aircraft in significant regions including the Middle East, Central Asia, Africa, and Europe.

The group's expansion strategy anticipates adding over 25 daily flights via Bahrain, with projected contributions of around BHD 3 billion (approximately USD 8 billion) to Bahrain's economy. Furthermore, the partnership is expected to generate over 100,000 jobs across related sectors, thus firmly aligning with Bahrain's economic aspirations.

A pioneering talent development program will see the recruitment and training of Bahraini nationals to fill various roles, targeting over 1,000 hires in the first year alone. The initiative aims to prepare local talent for careers in aviation, including piloting, engineering, and ground support.

Capital A's Maintenance, Repair, and Overhaul (MRO) arm, Asia Digital Engineering (ADE), intends to set up a modern facility in Bahrain. This facility will feature advanced hangars and workshops capable of servicing both narrow and wide-body aircraft, further honing local talent through specialized training programs.

Teleport, the logistics arm of Capital A, plans to leverage Bahrain as a key gateway for expanding its operations beyond Asia. This initiative includes basing dedicated freighters in Bahrain to enhance connectivity for the Middle East, Europe, Africa, and the CIS, assisting in the expansion of e-commerce and logistics channels.

This announcement comes on the heels of Capital A's decisive move to unify its aviation business under a singular AirAsia Group, focusing on agile global expansion while also fostering a robust travel and digital ecosystem.

Through this collaboration, Capital A and AirAsia are poised to unlock new market opportunities and pave the way for a more interconnected future for travelers and industry partners alike.