 "Reforms take wings")
The government’s ambitious plan of making flying affordable through the Regional Connectivity Scheme (RCS) requires states to participate, too. For which, the civil aviation ministry plans roadshows in state capitals and in cities identified under the scheme.
According to a ministry official, rather than having celebrity faces, this will aim to build awareness, beside a dialogue process with state governments. “We will have hoardings and other forms of out-of-home advertising efforts,” the official said.
The roadshows might start in August, after the government concludes the process of stakeholder consultation on the scheme.
The need for states to coordinate in these matter is seen in the recent example of the new airport near Durgapur. Government-owned Air India started operating from the Bengal Aerotropolis-run airport but has since stopped all flights, complaining the state government has been unable to pay the Viability Gap Funding for over two months. “We owe around Rs 5 crore on account of VGF from the state and despite writing multiple times, we have not got any response,” says a senior AI official.
A senior aviation ministry official said non-cooperation from states has also been a problem on the issue of taxes on aviation turbine fuel (ATF).
The national civil aviation policy lays down criteria before a state can participate in the RCS. Beside providing free land and infrastructure, states will have to reduce value added tax (VAT) on ATF at airports to one per cent for 10 years. And, amenities like power, police and fire services at concessional rates.
Also, a portion of the VGF will come from states. “It is best left to the states to decide on whether they want to reduce the charges. They should realise it will benefit them, too,” says aviation expert Anurag Jain. He points to Himachal Pradesh and Andhra Pradesh having already reduced VAT on ATF to one per cent.
Aiation minister Ashok Gajapathi Raju had earlier said states would be encouraged to reduce the surcharge on ATF, as a help to rejuvenate idle airports and airstrips.
“When you ask states to reduce ATF charges, they see it as a revenue loss. We have started it as a process of rejuvenating idle assets,” he said.
