Warning that some Indian airlines could fold up if structural changes were not carried out immediately, the IATA has asked the government to take speedy steps to enable the industry weather the "perfect storm" of high costs and falling demand.
"India is among the most expensive places on the planet to buy aviation turbine fuel (ATF) from. In August, it was 58 per cent more expensive to buy fuel in Mumbai for domestic flights than in Singapore," International Air Transport Association (IATA) Managing Director and CEO chief Giovanni Bisignani told PTI in an interview here.
Observing that the Indian aviation industry was passing through a "fragile and delicate moment", he said some airlines could go bust in the coming few months if "structural changes are not carried out expeditiously".
As many as 25 carriers worldwide have folded up operations in the past several months due to huge losses, the latest being Italian national carrier Alitalia, leading to over 100,000 jobs in the aviation sector being lost.
He projected a cumulative loss of $1.5 billion for Indian carriers this year, second largest after that in the US, and warned that the "dream of liberalisation can turn into a nightmare" if speedy action was not taken to counter "the perfect storm of burgeoning costs and falling demand".
The IATA chief identified three priority areas in which urgent action was required. These are — reducing costs, improving infrastructure and adopting global standards on safety, security and other issues.
Observing that privatisation in civil aviation has not yielded positive results worldwide, he asked the government not to project the country's emerging aviation sector "only as a market" but take the lead through innovative initiatives.
