Civil aviation policy delayed, likely to take off in early FY17 as govt still working on certain issues

In early next financial year, the Government is aiming to finalize a new civil aviation policy with its still working on certain issues like those related to the 5/20 international flying norm. In the last year (October), the draft policy was revealed and after an extensive consultations with the various stakeholders, some issues are still being settling down by the Government. As per R. N. Choubey- the Civil Aviation Secretary, the Ministry is planning for finalizing the Cabinet note for the policy by the end of this month after sorting out the said issues. Thus, in the current financial year, the Policy was expected to be finalized as certain proposals were to be implemented from 1st day of April, this year.

Choubey also found stated on the sidelines of the India Aviation- 2016 even here, and in particular he said that about Fifteen variations are being looked at with respect to the 5/20 rule.

As per the norm, the minimum Twenty aircrafts are allowed to fly overseas, those who have at least five years of domestic flying experience. Tatas being stakeholdes in the start-ups carriers- Vistara and AirAsia India, are appeared demanding that the rule be done away with, the grouping of four private Indian carriers comprising IndiGo, Jet Airways, SpiceJet and GoAir wants the rule to continue.

Moreover, the policy is proposed to boost the Indian aviation sector, which has high growth potentials and also for strengthening the regional connectivity. For Airlines, maintenance and repair works of the aircrafts, the policy is suggesting tax incentives besides mooting Two per cent levy on all air tickets for funding regional connectivity scheme. Also, it is proposing to have around Fifty per cents of the FDI- Foreign Direct Investment in the Domestic carriers, if the open skies policy will be implemented.

In other proposed measures, the no- frills airports setting up and provisions of viability gap funding for airlines for bolstering regional air connectivity. For making the Maintenance Repair, Overhaul- MRO cheaper, the Govt. has also proposed to exempt the activities from service tax net and VAT will also not be levied.

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