Civil Aviation Minister Ashok Gajapathi Raju today briefed Prime Minister Narendra Modi on crucial issues facing the aviation sector like building of airports at non-metro cities, slashing of taxes on jet fuel and turning around the ailing Air India.
A detailed presentation is understood to have been made on the issues which also included downgrade of India's safety ranking by US regulator Federal Aviation Administration (FAA) and review of the rule requiring an airline to have flown domestic for five years and having a 20-aircraft fleet, before it could be allowed to fly abroad.
The previous government was actively considering scrapping this rule on the grounds that an airline would have to first establish itself domestically before it could be allowed to fly abroad.
This issue would be crucial to start-up carriers like AirAsia India and Tata-SIA Airlines who would want to launch international flights as soon as they can.
Among other major issues raised were steps to encourage states to slash high sales tax rates on jet fuel, quick passage of the Civil Aviation Authority Bill giving the much- needed autonomy to the new aviation regulator and making India a hub of aircraft engineering facilities by helping Maintenance, Repair and Overhaul (MRO) units.
It is believed that Air India's turnaround and financial restructuring plans and equity infusion in it was also in focus.
The national carrier is seeking infusion of Rs 8,000 crore this financial year - Rs 5,500 crore for 2014-15 and Rs 2,500 crore as the shortfall in committed equity infusion in 2013-14.
If this is granted, the airline would have already received a total of Rs 22,000 crore of the Rs 30,000 crore revival plan chalked out by UPA-II government.
