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‘High taxes are killing’

Siddhantha Sharma, Chief Executive Officer, SpiceJet speaks to Samiran Saha & Gaurav Choudhury about the crisis in the Indian aviation sector.

business Updated: Dec 13, 2007 00:52 IST

Siddhantha Sharma, Chief Executive Officer, SpiceJet

Has Indian aviation sector hit an air pocket?

It’s a temporary air pocket. With airports infrastructure getting a face lift and airports in metropolitan cities undergoing major modernisation and upgrade programmes, I am sure the sector will reach glorious heights.

How badly has the repeated hike in aviation turbine fuel price hit the aviation industry?

It has seriously affected the airline industry. Earlier fuel would constitute 38 per cent of our operations cost, now it has touched a whopping 47 per cent of the total operating cost. It is only to an extent and a limit to which airlines can keep absorbing the high aviation turbine fuel charges. Rest has to be passed on to the consumers.

Would you say that the government has done its precious bit for the aviation sector?

Government has done what ever is possible. Right from fleet acquisition for the state-owned carriers, to forming new guidelines for private operators, cargo carriers so on and so forth.

What is the most important issue that the government needs to address to help airlines regain financial health?

I would say it would be rationalisation of taxes on aviation turbine fuel, which are among the highest in the world. Taxes on aviation turbine fuel vary from 4 per cent in Jharkhand to 39 per cent in Maharashtra. High taxes are killing us and the industry.

As told to Samiran Saha and Gaurav Choudhury