Govt hopeful of aviation sector doing better in coming year

Government today voiced concern over burgeoning losses of Indian airlines in spite of the high growth in air traffic but hoped that more carriers would take to the sky in 2015.
Addressing a meeting of Chief Ministers and state Civil Aviation Ministers here, Civil Aviation Minister Ashok Gajapathi Raju said that despite high air traffic growth rate, "most of the airlines in the country are reported to have incurred losses and some airlines are struggling to stay afloat."
Expressing hope that the new year would bring a change on the growth trajectory of the industry, he said the government proposed to have "more new airlines in the coming year."

Urging states to join the Centre in its initiatives to promote air connectivity, Raju said "the states understand the need to lower taxes. Some states have already come on board."
He said the government was also working on a package to promote connectivity and airports in the Northeastern states.
Listing out the problems facing the sector, the Minister said the aviation industry was " seriously affected" by high operational costs including cost of aviation turbine fuel, service tax and other charges, shortages of maintenance facilities, high foreign exchange rate and competition from foreign airlines.

There is a high customs duty on import of private aircrafts and helicopters also, he said.

Noting that aviation was acknowledged as a growth engine which has a force multiplier effect, Raju said as per global estimates, for every USD 100 worth of input, there is USD 325 worth of output generated.
For every 100 jobs created in the aviation industry, there are 610 jobs created in other industries, he said.
Minister of State for Civil Aviation Mahesh Sharma said the Ministries of Civil Aviation, Tourism and Culture have to work together "to realise the great potential that India has in the civil aviation sector".