BENGALURU: The absence of any major announcement for the aviation industry in the Union budget has put off professionals. As the industry faced huge losses and lay-offs due to the pandemic, they were expecting a couple of major steps to resuscitate the sector. The budget has offered tax exemption for aircraft lease rentals, tax holiday for capital gains for aircraft leasing companies, and monetisation of Airport Authority of India Assets in Tier-II and Tier-III cities.
Bringing the Aviation
Turbine Fuel under the GST structure and a cut in excise duty, were among the key demands that were made earlier but have not been touched upon in the Budget. Rohit Tomar, Managing Director of India’s first Aviation Data Consulting Firm, Caladrius Aero, told TNIE,
“The aviation industry suffered the most due to Covid-19 pandemic, after the hotel industry. I am startled, to say the least, that there has been no major announcement for this sector. The Maintenance, Repair and Overhaul (MRO) industry expected a lot due to the whole thrust on ‘Atmanirbhar Bharat’, but nothing happened.”
Aviation expert Captain Mohan Ranganathan said the tax exemption on rentals does not make sense in the present situation.
“The whole world is downsizing. In the Indian airline industry, 90% of aircraft is leased from foreign companies with payment made in dollars. Offering an incentive to lease more aircraft might not help the industry as a whole. Probably, Indigo or Spicejet stand to gain from it,” he said.
Airlines would not make profit by focussing on the domestic sector. “Operating them and the load factor was what they are presently concentrating on,” he added.