Govt to form ministers panel for aviation crisis

Posted By: Staff
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New Delhi, Aug 13: Prime Minister Manmonhan Singh has decided to form a panel of ministers to look into the issue of high jet fuel prices and taxes in the aviation sector.

Civil Aviation Minister Praful Patel made the announcement after briefing the Cabinet about the situation in the domestic and global aviation industry, including the cost of fuel in India.

Speaking on the fuel hike issue, Patel said aviation fuel was costing Rs 38,000 per kilolitre here, as against Rs 24,000 in Singapore, Rs 25,000 in New York, Rs 24,500 in Hong Kong, Rs 25,000 in Bangkok, Rs 26,000 in Tokyo, Rs 26,500 in Paris and Rs 26,000 in Dubai.

Patel said, "while Andhra Pradesh was charging the lowest sales tax of 4 per cent on jet fuel, it was 28-30 per cent in Karnataka, Gujarat, Kerala, Tamil Nadu and West Bengal."

"A Rs 1,000 change in aviation turbine fuel price translates into Rs 300 crore increase or decrease in the cost of operations of the sector," he said, adding that fuel prices have seen a rise of 99.6 pc over the past year or so.

The Minister's presentation on Thursday, Aug 13 came after the state-run Air India asked for fresh solution of equity to stay afloat and private carriers asking the government to announce measures that will bring down their cost of operations.

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