June 21, 2024

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Delighting finance buffs

Nirmala Sitharaman gives boost to virus-hit civil aviation, eases restrictions on use of Indian airspace

Finance Minister Nirmala Sitharaman on Saturday announced the fourth tranche of an overall package of Rs 20 lakh crore to deal with the economic fallout of the Covid-19 pandemic which focussed on structural reforms in new sectors where growth is possible and employment is generated, including air space management for civil aviation.

The FM announced that restrictions on utilisation of the Indian air space, of which only 60 per cent is freely available right now, will be eased. This will bring in a total benefit of about Rs 1,000 crore per year for the aviation sector. Along with ensuring optimal utilisation of air space, the new restrictions will also reduce fuel use, flying time and will have a positive environmental impact.

“Restrictions on the utilisation of Indian Air Space will be eased so that civilian flying becomes more efficient. Will bring a total benefit of Rs 1,000 crore per year for the aviation sector,” Finance Minister Nirmala Sitharaman said while addressing a press conference.

“Airports Authority of India has awarded 3 airports out of 6 bid for operation and maintenance on Public-Private Partnership (PPP) basis. Additional investment by private players in 12 airports in first and second rounds expected around Rs 13,000 crore,” FM Nirmala Sitharaman added.

Further, the FM said that India will now become a global hub for aircraft Maintenance, Repair and Overhaul (MRO).

Nirmala Sitharaman further said, “The tax regime for the MRO ecosystem has been rationalised. Aircraft component repairs and airframe maintenance will increase from Rs 800 crore to Rs 2,000 crore in 3 years.”

“The structural reforms being announced today will impact those sectors which are new horizons of growth, unleashing new investment, boosting production and creating jobs,” FM Nirmala Sitharaman said at the beginning of the press briefing on the economic package.

“We are going to focus on eight sectors today – coal, minerals
defence production, airspace management, MROs, power distribution companies, space sectors, atomic energy,” she said.

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