IATA chief calls for quick action to help crisis-ridden Indian carriers

New Delhi: Indian carriers have been hit hard from the global crisis arising out of high jet fuel prices and declining traffic and the airlines could post losses to the tune of $1.5 billion, Giovanni Bisignani, Director-General of the International Air Transport Association (IATA), cautioned on Wednesday.
The IATA chief said that growth of the civil aviation sector in India had slowed to 7.5 per cent in the first six months of 2008 from 33 per cent in 2007 and the last two months had also seen negative growth. He called for urgent action to help Indian carriers weather the storm of high costs and falling demand.
Mr. Bisignani identified three priority areas — reducing costs, improving infrastructure, and adopting global standards — in his address to the Confederation of Indian Industry (CII).
He said India was among the most expensive places to buy aviation turbine fuel (ATF). Last month, it was 58 per cent more expensive to buy fuel in Mumbai for domestic flights than in Singapore. Excise duties, throughput fees and State taxes of up to 30 per cent for domestic flights resulted in a cost structure that cannot support a competitive industry, he said.
Mr. Bisignani favoured removal of excise tax, implementing a standard four per cent State tax for domestic fuel and greater transparency in overall pricing as some of the urgent measures to help the carriers tide over the present crisis.
25/09/08 The Hindu

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Categories: Indian Aviation- In General Sep 2008