Friday, Jan 09, 2004
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By Our Special Correspondent
NEW DELHI, JAN. 8. Following the reduction of excise duty on Aviation Turbine Fuel (ATF) and abolition of the Inland Air Travel Tax (IATT) and Foreign Travel Tax (FTT), air travel is all set to become cheaper in the days to come. The Minister of State for Civil Aviation, Rajiv Pratap Rudy, said that it would go a long way in making air travel affordable to the common man. Reduction in the excise duty on ATF had been a long-standing demand of the operators and today's announcement would bring cheer to the aviation industry, which was passing through a difficult phase. "Aviation is a part of the core infrastructure industry such as roads and telephone and it has been the Government's effort to make air travel affordable and passenger-friendly. It is just the beginning of a bright future for the civil aviation sector in the country,'' Mr. Rudy said in a statement here. The Indian Airlines chairman-cum-managing director, Sunil Arora, expressed the hope that the relief measures would "inject new life to the civil aviation industry ailing particularly since the September 11, 2001 terror attacks.'' The abolition of IATT would directly benefit domestic air travellers, since they would enjoy commensurate reduction in airfares. "This will spur growth rates in air traffic which has already started witnessing positive trends for the last six months due to increased economic activity in the country,'' Mr. Arora said in a statement. The IA chief said that domestic civil aviation would further gain on account of the abolition of FTT and the new measures for customs clearance of inbound air passengers. The most important relief was the reduction in excise duty on ATF by half to 8 per cent. The annual savings on this account for IA were likely to be around Rs. 60 crores, he said, adding that it would enable the airline to generate more internal resources for its fleet renewal and expansion. The largest private domestic operator, Jet Airways, also welcomed the relief measures and said that corresponding relief would be passed on to passengers after January 9. A Jet Airways spokesperson said that maximum relief would be felt in APEX fares and the impact of a lower excise duty on ATF would be studied by the airline.
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