New budget airline for Middle East

The Middle East is to gain a new low-cost airline based in Abu Dhabi. 

Etihad Airways and Air Arabia are to launch a new joint venture called Air Arabia Abu Dhabi.

The budget airline aims to complement Etihad Airways' full service schedule from Abu Dhabi.

The new airline's board of directors, will come from members nominated by Etihad and Air Arabia but will be run as an independent standalone business, Travel Mole reports.

"We are thrilled to partner with Etihad to establish Air Arabia Abu Dhabi that will further serve the growing low-cost travel segment locally and regionally," said Adel Al Ali, group chief executive officer at Air Arabia.

"This step demonstrates the strength of the UAE aviation sector and serves the vision driving its growth."

Etihad has previously had ill-fated investments in Air Berlin and Jet Airways. 

Etihad and Air Arabia have not yet unveiled details on when the new airline would launch or what routes it will start flying.