The Hindu Business Line : Panel report may offer smooth takeoff for aviation

IN the next few months, if you see the proprietors of Jet Airways, Air Sahara, Air Deccan and Indian Airlines wearing broad smiles, don't be surprised. They might have enough reason for their merriment.

The general expectation is that the Naresh Chandra Committee, which has been set up to draw up a road-map for the domestic aviation sector, as also the forthcoming Union Budget are likely to provide some of the much-needed relief to the sector.

The popular belief is that after laying emphasis, which the current year's Budget did, on the tourism sector, the Budget to be presented in February next is likely to focus on how to rid the civil aviation sector of some of its problems. Sources indicated that the problems plaguing the sector are well known - be it the issue of rationalising the tax structure on aviation turbine fuel throughout the country, or of making funds available for operating flights to areas that are not financially viable.

Similarly, sources said that after the Committee submits its report, the Government may have little to do with the sector, except looking at security, air traffic control and act as an impartial umpire. The Committee's report is expected shortly.

However, sources say that the "general sympathy" of the Government towards the sector should not be viewed as an indication that all its demands, whether genuine or not, would be accepted. "The needs of the aviation sector will have to be finely calibrated with the demands being made by other sectors of the economy. Hopefully, there will be some relief for the aviation sector in the next Budget," sources told Business Line.

Besides, political compulsions — as next year's Budget would be the last before the general elections — and worries about the `F' factor or fiscal deficit could also make it difficult for the Finance Ministry to "accommodate" some relief for the sector "despite agreeing on the genuineness of the demand," sources said.

But despite the difficulties and political tight-rope walk which the Finance Minister may have to undertake, the fact is that the domestic aviation industry is waiting on the edge of the runway and expected to take off, sooner than later.

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