Aviation sector to post loss of 10,000 Crore: Ajit Singh

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Aviation sector to post loss of 10,000 Crore: Ajit Singh
Aviation Minister Ajit singh on Thursday said that the Airlines industry may post loss of Rs10,000 crore. Airlines are not able to meet their operating expenses due to high fuel prices.

Most of the airline stocks slipped after the news, the Kingfisher Airlines was lower 3.14% at Rs 13.90, the Jet Airways was down 3.38% at Rs 301.80 on the BSE at 10.30 am IST.

The total operational losses for all the airlines for the period 2008-09, 2009-10 and 2010-11 are Rs 19,000 crore approx. and Rs 10,000 crore loss is anticipated in 2011-12.

He further informed that there is no proposal to provide incentives to private airlines. However, an inter Ministerial Working Group has been constituted under the Chairmanship of Secretary, Ministry of Civil Aviation to identify the factors causing stress in civil aviation and suggest solutions to the same.

Finance Secretary; Secretary, Ministry of Petroleum and Natural Gas; Director General of Foreign Trade and Joint Secretary, Ministry of Civil Aviation are members of this Working Group.

The recommendations made by the Working Group, inter-alia, include rationalisation of Value Added Tax (VAT) on Aviation Turbine Fuel (ATF), permission to foreign airlines to invest in the domestic airlines undertakings, allow airlines to import ATF directly for their own consumption, revision of fare structure by airlines so that costs of operations are covered.

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Read more about: kingfisher, jet airways, aviation
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