Born in Jharkhand’s Giridh, Harvard-educated Jayant Sinha had served as an investment and strategy consultant with firms such as McKinsey & Co and the Omidyar Network. Elected as an MP from Hazaribagh in Jharkhand, Sinha is the minister of state for civil aviation in the Narendra Modi government and had also served as minister of state for finance earlier. Sinha, 55, said the inclusion of Aviation Turbine Fuel (ATF) under Goods and Services Tax (GST) regime is underway and added that national carrier Air India is doing well with regard to operating benchmarks.
Edited excerpts:
Q: Let me start by talking to you about the latest letter that has come in from the Federation of Indian Airlines (FIA) to your ministry. They have essentially written to you asking for deferred payment to airport operators as well as to oil companies. Is this something that your ministry is willing to consider?
A: We always engage with the industry. We listen to their concerns and issues. They have brought up multiple issues in the past that we had resolved. We shall take a look at the most recent representation from them and see what we can do to support the industry. Our goal is to provide supportive policy environment so that our airlines can flourish and succeed. Of course, they have to generate adequate return on capital, otherwise, they will not be able to invest in their businesses and continue to provide the excellent service as well as the connectivity that they have in the past. So, we will certainly take that onboard.
Q: How soon can we expect a decision as they are pretty much sending you an SOS? They have asked you to get a one month unsecured credit by oil companies and have asked to stagger payments over the next few months to airport operators. How soon can we expect a decision one way or the other on these specific demands that have been made?
A: We will have to look at each of the individual demands. Please recognise that the demands that are being placed are on other commercial entities, whether it's the oil marketing companies or the Airport Authority of India (AAI). Like airlines have to report back to their shareholders and are responsible to their shareholders, these commercial entities have similar responsibilities. So, many of these are commercial decisions that will have to be taken at that level. So, we will have to proceed as per the board requirements, as per the governance requirements that these companies have. Policy moves, that we can make as a government, certainly, we will try and move on them as expeditiously as we can. I will give you an example on some of the things that we have been working on with the industry. One of them is getting aviation turbine fuel (ATF) into Goods and Services Tax (GST) and that is a matter that we have discussed at length with the industry. We had several rounds of discussions with the ministry of finance and that matter is now going to go to the GST Council. So, wherever we can intervene at a policy level and make a difference to the industry, we are absolutely moving forward as quickly as we can.
Q: Just on the issue of ATF, this has been a long standing demand of industry and there has been a long process of consultation. When can we expect now to be taken forward as a formal proposal to the GST council?
A: The process of bringing ATF under GST is underway. It's with the GST council to decide when they will be bring it on their agenda and how quickly they deal with it. However, it's a complicated issue as ATF revenues are a very large item for many states and so have to proceed thoughtfully as far as it's concerned. So, we need to make sure that we maintain revenue neutrality as far as revenue collections are concerned. Second, this is a question of what happens to all the hydrocarbons. Obviously, we deal with the ATF, but there is petrol and diesel. Should fuel prices be brought in at the same time? Should we only deal with ATF right now? The whole hydrocarbon question is something that the GST Council has to deal with. The GST Council is also trying to ensure that the whole GST framework stabilises. So, these are the things that they are taking into account.
Q: The question of bringing the entire hydrocarbon sector under the ambit of the GST looks highly unlikely. Most states are not even onboard in principle with the idea. So, are you really looking at waiting to see if there is consensus that emerges with states on that before you take the ATF proposal forward?
A: Absolutely not. We have already taken the ATF proposal forward. As I said, we are pushing it as hard as we can on behalf of the industry. All I am saying is, when these issues go to the GST Council, it has to consider it along with all the other matters that I just mentioned.
As far as our industry and ministry is concerned, we are pushing as hard as we can. We are very fortunate that the ministry of petroleum and natural gas is with us on this and now it's with the GST Council.
21/11/18 CNBC-TV18
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Edited excerpts:
Q: Let me start by talking to you about the latest letter that has come in from the Federation of Indian Airlines (FIA) to your ministry. They have essentially written to you asking for deferred payment to airport operators as well as to oil companies. Is this something that your ministry is willing to consider?
A: We always engage with the industry. We listen to their concerns and issues. They have brought up multiple issues in the past that we had resolved. We shall take a look at the most recent representation from them and see what we can do to support the industry. Our goal is to provide supportive policy environment so that our airlines can flourish and succeed. Of course, they have to generate adequate return on capital, otherwise, they will not be able to invest in their businesses and continue to provide the excellent service as well as the connectivity that they have in the past. So, we will certainly take that onboard.
Q: How soon can we expect a decision as they are pretty much sending you an SOS? They have asked you to get a one month unsecured credit by oil companies and have asked to stagger payments over the next few months to airport operators. How soon can we expect a decision one way or the other on these specific demands that have been made?
A: We will have to look at each of the individual demands. Please recognise that the demands that are being placed are on other commercial entities, whether it's the oil marketing companies or the Airport Authority of India (AAI). Like airlines have to report back to their shareholders and are responsible to their shareholders, these commercial entities have similar responsibilities. So, many of these are commercial decisions that will have to be taken at that level. So, we will have to proceed as per the board requirements, as per the governance requirements that these companies have. Policy moves, that we can make as a government, certainly, we will try and move on them as expeditiously as we can. I will give you an example on some of the things that we have been working on with the industry. One of them is getting aviation turbine fuel (ATF) into Goods and Services Tax (GST) and that is a matter that we have discussed at length with the industry. We had several rounds of discussions with the ministry of finance and that matter is now going to go to the GST Council. So, wherever we can intervene at a policy level and make a difference to the industry, we are absolutely moving forward as quickly as we can.
Q: Just on the issue of ATF, this has been a long standing demand of industry and there has been a long process of consultation. When can we expect now to be taken forward as a formal proposal to the GST council?
A: The process of bringing ATF under GST is underway. It's with the GST council to decide when they will be bring it on their agenda and how quickly they deal with it. However, it's a complicated issue as ATF revenues are a very large item for many states and so have to proceed thoughtfully as far as it's concerned. So, we need to make sure that we maintain revenue neutrality as far as revenue collections are concerned. Second, this is a question of what happens to all the hydrocarbons. Obviously, we deal with the ATF, but there is petrol and diesel. Should fuel prices be brought in at the same time? Should we only deal with ATF right now? The whole hydrocarbon question is something that the GST Council has to deal with. The GST Council is also trying to ensure that the whole GST framework stabilises. So, these are the things that they are taking into account.
Q: The question of bringing the entire hydrocarbon sector under the ambit of the GST looks highly unlikely. Most states are not even onboard in principle with the idea. So, are you really looking at waiting to see if there is consensus that emerges with states on that before you take the ATF proposal forward?
A: Absolutely not. We have already taken the ATF proposal forward. As I said, we are pushing it as hard as we can on behalf of the industry. All I am saying is, when these issues go to the GST Council, it has to consider it along with all the other matters that I just mentioned.
As far as our industry and ministry is concerned, we are pushing as hard as we can. We are very fortunate that the ministry of petroleum and natural gas is with us on this and now it's with the GST Council.
21/11/18 CNBC-TV18
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