"Time is not on our side. Airlines from Europe may face some retaliatory action. And some non-European airlines may have to choose whether to obey the law of their land or that of Europe -- two more unintended consequences which should convince all states that the ICAO (International Civil Aviation Organisation) is the way forward," IATA chief Tony Tyler said.

He called for a global solution through the ICAO, a UN-body, to break the impasse on Europe's plans to "unilaterally" include global aviation in the EU Emissions Trading Scheme (EUETS).

India, Russia, the US, China and several other countries would meet in Moscow later this month to decide on whether to take retaliatory measures against the EU on its "unilateral" decision to impose carbon tax on air travel.

The EU imposed the tax from January, but about 30 countries, including India, Russia, China and the US, opposed the move, saying it was "inconsistent with the international legal regimes".

In a speech to the European Aviation Club in Brussels yesterday, Tyler said the consequences of the "unilateral and extra-territorial approach go beyond market distortions to states seeing this as an attack on their sovereignty."