Cathay Pacific Airways and China Airlines have extended for the sixth time an expired commercial agreement on flights between Hong Kong and Taiwan, after Beijing refused to approve a new deal worked out last year. Airline sources said approval was not expected soon, as major political hurdles remained. The latest extension is not likely to be the last. Cathay yesterday said that existing arrangements on flights between Hong Kong and Taiwan have been extended until April 29, as the Sino-British Joint Liaison Group negotiates a new deal, which allows one new airline from each side to fly the lucrative Taipei and Kaohsiung routes. In December, Cathay Pacific and the Taipei Airlines Association agreed to a new arrangement giving Hong Kong Dragon Airlines (Dragonair) and Eva Airways rights to operate between the two points, subject to liaison group approval. A main point of contention is China Airlines' timetable to remove the Taiwanese flag from the tails of its aircraft. The island's flag carrier revealed a new corporate identity on demand from China. It replaced the Taiwanese flag with a red plum blossom on aircraft, so that it could continue flying to Hong Kong after July next year. China has demanded that all aircraft be repainted by the 1997 handover, but China Airlines officials have protested. They say it would take three to four years to repaint the 40 aircraft in its fleet. Political tensions between China and Taiwan were also thought to have been an issue behind the delays, which have disrupted Dragonair's and Eva's plans. Eva has set up an office in Hong Kong and hired new staff, and Dragonair has leased a new Airbus Industrie A330 to fly between Hong Kong and Kaohsiung. Dragonair is now studying other routes in case the new deal collapses.