SpiceJet forsees tough times
Budget carrier SpiceJet's chief executive Neil Mills feels the aviation sector, marred by high fuel and interest cost in the coming fiscal, will continue to face "tough operating conditions".
"I think the tough conditions will continue for a while in the coming fiscal," said Mills. "Our futures are pegged with oil prices and they are very high right now. There are some decisions on new policy like direct import of fuel and FDI. We are evaluating them and will do what is best for us."
According to Mills, the low-cost carrier (LCC) was in touch with fuel suppliers for logistical support to allow airlines to directly import jet fuel.
"We are evaluating the impact of the decision whenever it comes," he said. "We are in touch with them (fuel suppliers), but I cannot comment on how much savings would emerge out of this. But it will be substantial."
Mills' views come as the government had on February 22 notified direct import of jet fuel and called upon interested carriers to apply for licences.
The move will enable airlines to cut operating costs by about 10-15%, saving on sales tax, which ranges between 3% and 35% and is levied by state governments.
On the issue of foreign capital by foreign airlines in domestic passenger carriers, Mills said the airline was not looking for a foreign partner but was evaluating the proposal.