New Delhi, Oct 22 (UNI) Civil Aviation Minister Praful Patel today said the airline companies will pay off their outstanding fuel bills of Rs 2,800 crore to the state-run oil marketing companies (OMCs) in six monthly installments by March next year.
''Cumulatively, all the oil companies have an outstanding towards all the airlines of close to about 2,500-2,800 crores depending on the latest figures. The airlines in view of the difficulties will pay the outstanding bill in six monthly installments,'' Mr Patel told reporters here after meeting Petroleum Minister Murli Deora.
The meeting, which was convened here in view of the financial crisis being faced by the Indian airline industry, was also attended by the senior officials of oil PSUs and representatives of the airline industry.
''The idea is to give a cushion to airlines, which have been hit hard due to the slowing of demand,'' he said.
Mr Patel also said the credit period has also been increased for local carriers to 90 days from 60 days, and refineries would revise jet fuel prices every 15 days instead of 30 days.
The industry is also urging the government to reduce the Aviation Turbine Fuel (ATF) prices.
''I have conveyed it to the Finance Ministry...I have met Chidambaram and we have had a word about the taxes imposed on the aviation sector. The ATF is high and is imposed by the states also apart from what the Centre imposes. It is high time that we reduce the tax and rationalise it. This demand is not new, I myself have been pressing for it for four years now,'' he said.
The country's aviation industry is expected to lose two billion dollars in the current financial year, primarily on account of high ATF prices and slowing demand.
Meanwhile, agreeing with the Civil Aviation Minister's concern over the losses, Mr Deora said, ''Aviation Industry should be encouraged as it provides ample opportunities of growth,'' but in return the airlines should refrain from any retrenchment of staff.
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