NEW DELHI: The civil aviation sector is on the verge of collapse with accumulated losses of Rs 49,000 crore and needs an urgent boost to prevent more Kingfisher-type meltdowns and job losses, Prime Minister Narendra Modi was told on Saturday.
The review meeting saw civil aviation minister Ashok Gajapathi Raju pointing out that poor returns from airports, burgeoning costs and a tax structure that hurt Indian maintainance, repair and overhaul industry was burying the sector under debt.
Raju is understood to have compared the situation with what the telecom sector faced in 1999 before the then Vajpayee government worked out a rescue package that allowed mobile service providers to move from fixed fees to revenue sharing.
The ministry in its presentation stressed on the potential of the MRO industry generating large revenues and enhancing employment if service tax and VAT structures were made more attractive. The current rates make India a 35% more expensive destination for MRO operations than a place like Singapore.
Raju stressed the government did not want any aviation company to go under. There should not be any more Kingfishers and job losses, he said indicating the fragile financials of several private operators.
File photo: Striking employees of Kingfisher Airlines holding placard during protest march at domestic airport in Mumbai.
News From Times of India
The review meeting saw civil aviation minister Ashok Gajapathi Raju pointing out that poor returns from airports, burgeoning costs and a tax structure that hurt Indian maintainance, repair and overhaul industry was burying the sector under debt.
Raju is understood to have compared the situation with what the telecom sector faced in 1999 before the then Vajpayee government worked out a rescue package that allowed mobile service providers to move from fixed fees to revenue sharing.
The ministry in its presentation stressed on the potential of the MRO industry generating large revenues and enhancing employment if service tax and VAT structures were made more attractive. The current rates make India a 35% more expensive destination for MRO operations than a place like Singapore.
Raju stressed the government did not want any aviation company to go under. There should not be any more Kingfishers and job losses, he said indicating the fragile financials of several private operators.
File photo: Striking employees of Kingfisher Airlines holding placard during protest march at domestic airport in Mumbai.
News From Times of India
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