New Delhi, 7 March 2005
Several states are waking up to the potential that no-frill airlines hold in giving a fillip to tourism and in unlocking the value of various tourist destinations in the country.
The North Indian states of Uttaranchal, Himachal Pradesh and Jammu & Kashmir are undertaking a feasibility study for launch of a mountain airline service, comprising small aircraft and helicopters.
Some other states are toying with the idea of bringing down sales tax on aviation turbine fuel (ATF) to trigger tourist flow into specific sectors. Southern metros like Hyderabad and Bangalore are already positioning themselves as regional hubs for low-cost airlines.
If the feasibility report — being prepared by IDFC along with Uttaranchal Infrastructure Development Corporation — finds the project viable, one would, by early next year, be able to hop across various Himalayan destinations on a Mountain Airline service.
“We are open to the idea of bringing down taxes on ATF to keep down the cost of travel by such airlines,” said a senior official of Jammu & Kashmir tourism. Even as Air Deccan starts operations between Jammu and Delhi, another private carrier has evinced interest in connecting several destinations in the state, including Leh, Jammu, Srinagar, Katra, Poonch, Rajouri and Kargil, through short-hop flights.
“We would like a tourist to fly from one destination to another at a price-point that is slightly higher than travelling by road in a taxi,” an official added.
By the middle of this year, Uttaranchal plans to air-connect the holy shrines of Badrinath, Kedarnath, Hemkunt Sahib, Gangotri, Yamunotri and Haridwar through the Pawan Hans helicopter service.
Air Deccan, which currently flies into Dehra Dun, is expected to extend its service to several destinations in the state within the next year. In Himachal Pradesh, high on the agenda is to bring Kullu-Manali and Dharamsala into the low-cost airline circuit, apart from devising ways to better utilise the 55-odd helipads in the state.
Efforts are also on to connect Goa by air to northern states like Uttranchal and Himachal for developing a “Sea-to-Mountain” tourist circuit, with plans to offer sands of Rajasthan as an add-on.
Private air carriers claim that the biggest impediment to operating in the hills are high operational costs owing to taxes on ATF as well as maintaining a viable passenger load factor, as tourist inflow will be seasonal.
ATF constitutes close to 40% of an airline’s operating costs in the country, more so with state governments charging a differential sales tax rate, ranging anywhere between 15% and 34%.
News Source: http://economictimes.indiatimes.com