New Delhi: Union Minister of Civil Aviation,P. Ashok Gajapathi Raju discussed issues pertaining to civil aviation with the representatives of the civil aviation industry in a pre-budget interaction meet today. In his keynote address, the Minister stated that air travel has a multiplying effect on economy and, therefore, decisions should be made to allow civil aviation sector to grow to its full potential. The different wings of the Government would come together to find solutions for the problems faced by the industry today, he assured. He said the deliberations and suggestions made during the interaction would help his Ministry identify challenges posed to the growth of civil aviation sector and , at the same time, find ways to address those challenges.
During the interaction, issues regarding updation of standards for security equipment, establishment of a “green” channel for MRO equipment and allocation of appropriate funds for air navigation facilities were discussed among other subjects. The industry made several suggestions for the promotion of MRO sector including removal of service tax, reducing VAT on MRO activities, ten-year tax holiday, abolition of central excise duty on MRO component etc. If these measures are taken, it was represented, there would be creation of one lakh jobs with more than a billion dollar revenues to the country on account of MRO activities. The stakeholders also requested to treat ATF as a “declared goods” so that VAT on ATF could be reduced to 4%. This would make airlines more viable as ATF constitutes more than 45% of the cost. The airlines representatives requested that airlines should be given the infrastructure status to enable access to funds with lower rate of interest through external commercial borrowings. The industry stockholders also made suggestions with regard to dedicated air cargo stations and general aviation as a necessary force-multiplier.
The meet was attended by the representatives of FICCI, AMCHAM, US- India Aviation Cooperation Program, FAA and other organisations. Secretary, Ministry of Civil Aviation, V. Somasundaran also addressed the participants.