Four airlines shut shop over three years: Government

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SME Times News Bureau | 20 Nov, 2019
Four domestic airlines, including Jet Airways and JetLite, have shut their operations over the last three years for want of funds and unavailability of aircraft, Parliament was informed on Wednesday.

Among the four carriers, the LEPL Projects Ltd-run Air Costa and Air Carnival suspended their services in 2017 due to non-availability of aircraft.

As per a written reply by Civil Aviation Minister Hardeep Singh Puri in the Rajya Sabha, Jet Airways and its subsidiary JetLite suspended their services in April this year on account of a funds crunch.

The government has said that it is conscious of the financial difficulties being faced by the airlines and is responding to the industry situation.

The Civil Aviation Minister listed out a slew of measures taken by the government to enable growth in the sector.

"Government is acutely conscious of the financial difficulties faced by the airline companies. Accordingly, the government has constantly been responding to industry conditions and undertaking specific measures to facilitate and enable growth of the sector," Puri said in his reply.

The Minister said the government was coordinating with all the stakeholders to resolve their issues.

As a result, the central excise duty on aviation turbine fuel (ATF) has been reduced from 14 per cent to 11 per cent effective October 11, 2018.

The Minister said that 100 per cent FDI has been allowed under the automatic route to ensure modernisation of airports and establish high standards.

The other measures taken, include allowing foreign airlines to invest up to 49 per cent in Indian carriers under the automatic routes and liberalisation of domestic code-share points in India within the framework of the Air Service Agreement (ASA).

"Each airline, however, prepares its business plan on the basis of its own market assessment and liabilities. Mobilising financial resources and ensuring efficient operations as per business plans are the responsibility of the airline," the Minister said.

"Government of India has no role in raising funds for private airline companies as it is an internal matter of the airline," he added.