India's Civil Aviation Sector growth at negative 1.94%

The Minister for Civil Aviation, Shri Praful Patel informed the Lok Sabha today that the domestic passenger growth has declined to negative 1.94% during the period January to October, 2008 as compare to growth of 46.5% and 32.5% in the full calendar year 2006 and 2007 respectively.

Passengers carried by domestic airlines from January to October, 2008 were 346.81 lakhs as against 353.67 lakhs in the corresponding period of 2007. Domestic Airlines carried 31.80 lakhs passengers in the month of October, 2008 as compare to 36.01 lakhs in the month of October, 2007.

Aviation Sector was first greatly affected due to rise in fuel prices. Thereafter the slowdown of the global economy has caused decline of aviation sector growth. The decline in Indian aviation growth is not due to lack of infrastructure since there is adequate capacity at Indian airports to handle the existing demand.

To meet the challenges of slow down in the aviation industry, the Government has taken various steps which inter-alia are as under:

1. Custom duty on import of ATF has been abolished.

2. The State Government have been persuaded to reduce the sales tax on ATF. Government of Andhra Pradesh and in certain cases Government of Rajasthan have reduced the sales tax on ATF to 4%. Government of Maharashtra has also reduced sales tax on ATF from 25% to 4% for flights originating from airports other than Pune and Mumbai.

3. The oil companies have also staggered the dues of airlines companies over six months.

4. With the fall in global crude prices, the oil companies have been reducing ATF prices since September, 2008.

5. The infrastructure at the airports and Air Traffic Control and Navigation is being constantly upgraded to meet the future demand of the airlines.

Source : Press Information Bureau

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