2% fare levy, cap on short routes |
The Ministry of Civil Aviation has proposed an upfront subsidy to airlines by levying a two per cent fee on all domestic and international commercial flights in order to bring down the cost of air travel on non-metro routes.The proposed move, which could result in an increase in flight costs on trunk domestic air routes such as those connecting major metros as well as international routes, is aimed at bringing down the cost of air travel on non-metro routes to about Rs 2,500 per flying hour under a freshly conceived Regional Connectivity Scheme (RCS) that was unveiled in the revised draft civil aviation policy .The subsidy will be funded through a two per cent levy on air fares for both domestic flights on trunk routes and on international commercial flights and is expected to generate Rs 1,500 crore per annum. The ministry said that it is looking at liberalising the bilateral regime by permitting open skies between India and SAARC nations and countries beyond 5,000 km radius ofDelhi.Post-April 2020, open skies arrangement with countries within 5,000 km radius will be considered along with a proposal to allow FDI in India airlines over the current 49 per cent.
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