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FICCI and KPMG have said India is making self-goals in the aviation sector, driving away business. Stating that the industry is over-taxed, they said this aspect is clearly reflected in the industry’s lack of competitiveness at the global level.
FICCI and KPMG released the Indian Aviation 2014 report at the India Aviation show here on Thursday.
KPMG’s India Head of Aerospace and Defence Amber Dubey said the MRO segment is classic example of scoring a self-goal. “Only 5-10 per cent of the MRO (maintenance, repairs and overhaul) work for domestic scheduled carriers is carried out in India, while most of the maintenance activities are outsourced to third-party service providers outside the country,” he said, releasing the report.
The total Indian fleet is expected to double to 1,000 aircraft by 2020, promising a huge opportunity for the MRO business. But high taxation could drive away this opportunity.
He said the industry would require 3.50 lakh new employees to facilitate growth in the next 10 years. The total manpower is expected to rise to 1.17 lakh by 2017 from 62,000 in 2011, the report said.
High taxes on ATF are also adversely impacting the industry.
>kurmanath.kanchi@thehindu.co.in
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