Telangana slashes VAT on aviation fuel by 15% | india news | Hindustan Times
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Telangana slashes VAT on aviation fuel by 15%

A minister said VAT had been cut down to 1% from 16%

india Updated: Mar 24, 2018 00:02 IST
Faizan Haidar
Faizan Haidar
New Delhi, Hindustan Times
This photo taken on October 15, 2008, shows ground crew standing next to a newly-inducted Air India Airbus A319 aircraft during the opening day of India Aviation 2008 at Begumpet Airport in Hyderabad.
This photo taken on October 15, 2008, shows ground crew standing next to a newly-inducted Air India Airbus A319 aircraft during the opening day of India Aviation 2008 at Begumpet Airport in Hyderabad. (AFP)

In a move likely to increase air traffic at the Hyderabad airport, Telangana industries minister KT Rama Rao on Friday announced a slash in Value Added Tax (VAT) on Aviation Turbine Fuel (ATF).

The minister said VAT had been cut down to 1% from 16%. He was speaking at an event marking 10 years of the airport’s functioning.The airport already handles 50% more traffic than its designed capacity, according to its CEO SGK Kishore.

Kishore also announced plans for the airport’s expansion at the event. He said the capacity of the airport is 12 million per annum while it handled 18 million passengers last year. “We will incentivise the airlines which operate during off-peak hours and operate wide-body aircraft. The issue with Hyderabad airport is that traffic is bunched during the morning and evening hours. The issue is pending with the regulator and if approved, it will help us in utilising the infrastructure better,” said Kishore.

He added that through better utilisation of infrastructure and an additional runway, the airport will be able to handle 50 aircraft an hour, up from the current 26. “We have revised the master plan and the ultimate capacity of the airport would be 35-40 million. A team of the Airports Authority of India (AAI) and the Hyderabad airport is in the UK to study the best international practices and those will be implemented here,” he said.

Hyderabad airport officials said since 2014, passenger traffic growth rate for the airport has tripled from 7% (till 2014) to about 21% year-on-year over the last four years. The government also announced a direct metro link connecting the airport with the city. He also said the airport would get its own aerocity along the lines of the one in Delhi.

Another airport for Delhi and Mumbai

Civil aviation secretary Rajiv Nayan Choubey, also present at the event, said a second airport is being planned in Delhi and Mumbai with a budget of ₹15,000 crore each. Asked about the Air India divestment, he said expressions of interest for the proposed disinvestment would be out in 2-3 weeks.