Sops for budget airlines flying to smaller towns

Mumbai: Corporates and local governments have begun offering financial incentives to airlines to fly to smaller towns. Companies, whose people suffer most from long road journeys in the absence of air-connections, have begun underwriting seats for airlines to sustain the airline operations.
Tata Steel, for instance, guarantees 30 seats daily on Air Deccan’s ATR flights to Jamshedpur. In a similar deal at Kandla, Welspun Gujarat has taken up 20 seats to make travel easier to its plant at Anjar. The companies, usually have several executives or visitors travelling to the sites daily. They guarantee to fill up the seats or pay for them at a pre-determined fare level.
State governments are baiting airlines by offering lower sales tax on aviation fuel.
29/11/06 Economic Times

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