Heathrow Airport passengers slip in March

LONDON, April 11 (Reuters) - Britain's biggest airport Heathrow said passenger numbers fell slightly in March due to the timing of Easter, as it warned that it was falling behind rival international airports.

Heathrow, situated west of London, is operating close to capacity, and is at the centre of a long-running political tussle over airport expansion in the south-east of England.

The airport said for the first two months of 2014, Dubai had overtaken it, carrying about 12 million passengers against Heathrow's 10 million.

"We want Britain to continue to compete globally against the best hub airports in the world but without a third runway, Heathrow's comparative decline will make the whole of the UK a less attractive to do business," Heathrow chief executive Colin Matthews said on Friday.

Heathrow was last year shortlisted as a location for a new runway. A recommendation about where a new runway should go will be made by the Airports Commission in the second half of 2015.

In line with its expectations, Heathrow said 5.8 million passengers passed through its airport in March, 2.8 percent less than in the same month last year, which included the Easter break. Easter falls in April this year.

The airport is owned by unlisted Heathrow Airport Holdings (HAH). Spanish infrastructure firm Ferrovial (Madrid: FER.MC - news) , is the largest shareholder in HAH alongside partners Qatar Holding, China Investment Corp. and the Government of Singapore Investment Corp. (Reporting by Sarah Young; Editing by Neil Maidment)