According to the Oxford Economic Report on benefits from air transportation in India published in 2011, the aviation sector contributes 0.5 per cent to GDP and when taken with its catalytic benefits through tourism, it contributes 1.5 per cent. According to the same report, the aviation sector supports 1.7 million jobs in India of which 2,76,000 are directly supported while 8,41,000 are indirectly supported and 6,05,000 are supported through spending by employees of various sectors and their supply chains.
In contrast Indian Railways, which is a much bigger and older network, contributes less than 1 per cent of GDP. However, it is known that the aviation sector, both the airlines and airports, are in financial stress and need to be helped. The reason for the financial stress is well known. The fiscal regime followed by the central and state governments is over-taxing the sector. Aviation Turbine Fuel (ATF), which constitutes between 40 and 50 per cent of an airline's operating costs, cartelised pricing by public sector oil companies and very high sales tax by leading states like Maharashtra and Delhi is bleeding domestic aviation.
01/03/13 Indian Express
