ASSOCHAM calls for low jet fuel taxes

B D Narayankar

Press Trust of India

Bangalore, Nov 12: With dozens of flight
cancellations across the country, ASSOCHAM today called for
low taxes on jet fuel, liberal foreign investment norms and a
new civil aviation policy which are in tune with current
global and domestic realities.
"The government must rationalise tax structure so that the
airline industry can grow further," said Associated Chambers
of Commerce and Industry of India (ASSOCHAM) in a statement.
ASSOCHAM also said a right tax structure and healthy
regulatory mechanism are essential for expanding and upgrading
existing infrastructure facilities besides creating new ones.
"Airlines could suffer losses worth about Rs 15,000 crore
in the current financial year with Air India alone likely to
account for more than half of it. They need fresh funds and
there will be a question mark on their survival if they are
unable to raise them, he said," ASSOCHAM Secretary General D S
Rawat said.
Rising crude oil prices, depreciating Rupee and cut-throat
competition have eroded airlines' ability to raise fares,
despite about 19 per cent passenger growth this year, he said.
Rawat asked the government to scrap the existing rule of
not allowing foreign airlines to invest directly or
indirectly in domestic carriers.
He also demanded cutting down of airport charges and
streamlining ground handling operations.
ASSOCHAM said India’s scheduled airlines is likely to
go up to 1,500 by 2025 from 430 planes at present.