'Civil aviation sector up 18.5% in seven years'

India's financially troubled civil aviation sector grew at 18.5% in the last seven years and the government has taken various steps to resolve the woes faced by airline industry, the Economic Survey for 2011-12 said on Thursday.

According to the survey, tabled by Finance Minister Pranab Mukherjee, a working group was constituted to address issues concerning the viability of the civil aviation sector had made several recommendations like rationalisation of value added tax (VAT) on aviation turbine fuel (ATF) by state governments, allowing foreign airlines to invest in domestic carriers and direct import of ATF by airlines.

"The Working Group also decided that airlines should be asked to prepare their turnaround plans, which would be examined by the concerned departments of the government separately for each airline. Another recommendation was that fare structure should be reviewed by airlines so as to cover the cost of their operations," the survey said.

The survey also illustrated data on the growth of domestic passenger traffic handled at Indian airports which increased by 19.4% at 108.1 million during January-November, 2011 from 90.5 million in the corresponding period of previous fiscal.

"International passenger traffic and cargo handled at Indian airports grew by 7.7% during January-November 2011 and was placed at 33.6 million passengers and 1.4 metric million tonnes (MMT) of cargo," the survey said.

The survey also pointed out that airport infrastructure development continued at a significant pace with the upgradation of Kolkata and Chennai airports underway.

"In another 18 non-metro airports, various upgradation works like expansion of terminal buildings, aprons, taxiways and aerobridges have been taken up."

The survey added that the government has given in-principle approval for setting up of greenfield airport at Karaikal in Puducherry and Shirdi in Maharashtra.