Aviation growth, with 2K planes soon, ‘phenomenal’: Puri

ATF accounts for a chunk of the operational costs of an airline. The cost of aviation is high as there are institutional constraints: Union Civil Aviation Minister Hardeep Singh Puri

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Indian civil aviation

New Delhi: The Indian aviation sector is witnessing phenomenal growth and there could be 2,000 planes in a short time, Union Civil Aviation Minister Hardeep Singh Puri said on Friday.

Puri told the Lok Sabha that the country’s aviation sector is the third-largest in the world and there is an annual growth of 17%.

In 2008, the number of passengers stood at 117 million and now it is around 440 million. It is expected to touch 1 billion, the minister said.

With the kind of orders for aircraft, the number could be 2,000 in a short time, Puri noted. The country currently has over 600 aircraft.

The minister was responding to a debate on a bill to amend the Airports Economic Regulatory Authority of India (AERA) Act.

Puri said he would ask Finance Minister Nirmala Sitharaman to delink Aviation Turbine Fuel (ATF) from petrol and diesel. ATF accounts for a significant chunk of the operational costs of an airline. The cost of aviation is high as there are institutional constraints, he said.

The minister said the debt of Air India is completely unsustainable and privatisation of the airline would be pushed through soon.

The national carrier has a debt burden of more than Rs 50,000 crore. To make business worse recently, Air India suffered a loss of Rs 430 crore in the four-month period when air space was restricted by Pakistan after the Balakot airstrikes.

On 17 July, the minister had said the government was committed to privatisation of the national carrier but was working on a turnaround plan for making it profit-making before it is privatised. He had said that 40% of the operating expenses of the airline is on fuel and other geopolitical factors and the closure of air space by Pakistan cost the airline dearly.

Last year, efforts for strategic disinvestment of the airline failed to take off. The difficult situation in the aviation sector is mainly on account of high crude prices and depreciation of the rupee.