MPs concerned over air fare hike

May 7th, 2008 - 11:26 pm ICT by admin  

New Delhi, May 7 (IANS) Parliamentarians who are members of the Consultative Committee on Civil Aviation (CCCA) Wednesday expressed concern at the hike in air fares due to the rising cost of aviation fuel. The committee members who met here said the rising price of aircraft fuel, also called aviation turbine fuel (ATF), has forced airline operators to increase the air fares to meet their operational costs. Most of the airlines this month hiked their air fares by 10 percent.

Civil Aviation Minister Praful Patel said the aviation sector was witnessing massive growth but the high cost of aviation fuel was creating an adverse impact on the industry.

“The operational cost is already on the higher side and that has forced the airlines to revise air fares. There has been an impact on the number of passengers. The load factor has also dropped,” the minister told the committee members.

Patel also informed the members that most states have ignored the ministry’s plea to rationalize sales tax on aviation fuel. Except for a few states, taxes on the ATF are as high as 35 percent, he said.

The cost of aviation fuel in New Delhi has increased this month to Rs.58,387.92 per 1,000 litres from Rs.53,309.30 - a hike of Rs.5,078. In Mumbai, it has gone up by Rs.5,276. Meanwhile, the price of crude oil has touched $122 a barrel in the international market this week. A barrel is 158.9 litres.

The industry’s hopes of relief in ATF taxes in the 2008-09 budget were not fulfilled.

The ministry had taken up the issue for discussion before the cabine, and also with the ministries of finance and petroleum and natural gas, but it remained unresolved.

The CCCA also discussed issues related to air connectivity, services of the public sector carriers, existing facilities at airports and an ombudsman for private airlines, besides the queastion of pilot training institutes.

The committee discussed an incident in which a private sector airline refused to carry a coffin.

The minister said he would ask the Directorate General of Civil Aviation (DGCA) to issue stricter and mandatory guidelines to all airlines to ensure that they do not refuse help in such cases, unless they have valid reasons.

The new greenfield airport policy also came up for discussion before the committee. The minister clarified before the CCCA that only new airports to come up at Mumbai, Delhi, Hyderabad and Bangalore will require the approval of the cabinet in accordance with the new policy.

“There are existing contractual obligations with the airport operators at these four airports. But any other greenfield airport that will come up in future will only need the approval of the Steering Committee headed by the civil aviation secretary,” he said.

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