Business & Finance

Aviation ministry pleas Finance ministry regarding a package to boost airlines

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The rise in the price of aviation turbine fuel (ATF), the highest in last four years, and the plummeting value of Indian Rupee in the international market, Indian Airlines is struggling to float its boat. The ministry of aviation is currently working on a package plan to keep the airlines in the business. The operating cost is increasing every day pressing the airlines sector financially. Once the package is planned, it will be placed in front of the finance ministry for approval. Earlier, the request from the aviation ministry of availing jet fuel at a lower GST rate was unapproved by the finance ministry.

The aviation ministry is planning to ask for a lower rate of excise duty on the ATF. The current rate is 14% and the ministry is hoping to reduce it to 8%. It is also planning to avail overseas loans as a working capital to bridge the financial gap and make the operations better. The aviation ministry has also thought of including a step of acquiring a particular share of INR 130/passenger. This amount is paid as the security money every flyer pays. The aviation ministry is urging to retain this amount.

Suresh Prabhu, Aviation Minister, and Jayant Sinha, his deputy, met Arun Jaitley, Finance, to discuss the plan. Sinha said “We discussed range of issues with the FM. We are hopeful of making profess on all those issues regarding the financial health of the aviation sector.” The ministry is seeking a quick action to keep the industry running with a better profit range.

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