Tuesday, November 28, 2023

‘Now the idea is that airports bring development’: Jyotiraditya Scindia

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India’s biggest political conclave of 2021- The India News Manch is being held today in the National Capital, with the who’s who of Indian politics adorning the stage. The mega conclave witnessed the presence of India’s biggest political leaders and voices on one stage

Minister of State for Civil Aviation Jyotiraditya Scindia joined us for an exclusive interview as part of the conclave.

Talking about the progress in the civil aviation sector, Scindia said, “There used to be a time when air travel was meant for just a few. In the last seven years, our PM has taken the step to democratize civil aviation under the “Udey Desh Ka Har Nagrik” scheme. This step is revolutionizing the aviation sector. The archaic notion used to be that development brings airports. This idea has now been turned onto its head. Now the idea is that airports bring development. If someone is setting up an industry anywhere in the world, the first question that comes is about the availability of an airport. Before 2014, 74 airports were built in the 70 years since independence, and we built 65 new airports in just the last seven years. Today, India has a total of 149 airports, heliports, and waterdromes. I believe that the economic progress of a nation is tied to the development of its aviation sector. For a fair comparison, 18.5 cr people travel in railways’ AC 2 Tier and upwards classes whereas 14.5 cr people travel by air, however, the CAGR of passenger traffic that the railways is witnessing is at a stable 5.6% whereas the CAGR of passenger traffic in the civil aviation sector is increasing and already at 10.5%. So I can say this with a guarantee that there will be more people travelling by air than people travelling by AC 2 Tier or AC First Class, in the next 6-8 years. This is the potential that this country wields.”

Speaking about further reforms in the aviation sector, the civil aviation minister said, “There’s this ambitious helicopter policy that I announced in Dehradun on October 8, and under the policy, I am pushing for dedicated helicopter hubs – one in Guwahati, one in Mumbai’s Juhu, one in Gurgaon, and one in Akshardham.”

Scindia also spoke about efforts to check the rise in air-fuel prices. He said, “We will also have to focus on the structural economics of the civil aviation sector. There is hardly any other sector in the industry where the price of a single component of raw material is 29% of that industry’s cost structure. The civil aviation sector is the only such industry where air-fuel(ATF) is 39% of that cost structure. And the industry that’s witnessing huge losses- our airlines saw losses worth 19,000 crores last year- the cost structure of that industry also becomes its revenue structure. So if you’re earning a rupee, and the 39p from that Re.1 goes to buy the raw material, then that means you have to recover all the other costs and earn your profit from the remaining 61p which is impossible. So it’s my duty as the Civil Aviation Minister to make that economical cost structure more economical because if that doesn’t happen then these airlines won’t remain afloat for long because the industry that’s witnessing losses worth Rs.19,000 cr won’t survive for long. And this is the reason why my focus has been on making the cost structure of ATF affordable. I have had discussions with the Finance Minister about reducing the excise duty on ATF from the current 11% because the excise duty used to be 8% when oil used to cost 40-50$ per barrel but now when the price is around 80-85$ per barrel – you can imagine the immense pressure on the airline industry when the excise duty on the current fuel price is 11%. So the central government will have to reduce that excise duty. Then we have the states that impose VAT on air-fuel. While some states impose a VAT of 1-5%, most states impose it at a rate from 25-30%. So, first, we have the high fuel prices, then comes the Centre’s excise duty, and finally comes the VAT imposed by states. Who can afford air travel like this? So I held dialogues with CMs of 22 states and UTs and their governments got the VATs reduced from 25-30% to a mere 1-2%. Those states and UTs are  – Andaman & Nicobar, Madhya Pradesh, Jammu & Kashmir, Ladakh, Tripura, Himachal Pradesh, Uttarakhand, and Haryana.”

Our next question to Jyotiraditya Scindia was about the opposition’s attack on the BJP government for economic reforms like disinvestment and monetization of assets. Scindia replied, “The public knows and understands these tactics. The party that, while in power, disinvested assets worth Rs. 99,000 cr of 35 PSUs — What credentials do they have to criticize the current government? One should always remember – words and actions shouldn’t differ. And as far as disinvestment is concerned, the problem is that they either don’t understand or they don’t want to understand. In the civil aviation sector, there is neither any disinvestment nor are public assets being sold off. We have definitely handed over 6 airports to private players, but we have done that under long-term leases. After the lease period is over, the government will get back the ownership of the airport with all the investments of the private player. How is that disinvestment?”

We then asked him about youth leaders deserting the Congress party, to which Scindia said, “It takes years to groom a leader. My first priority has always been in the present or the future. My responsibilities as a minister and a party member are my priority. I don’t waste my time dwelling over the past and neither am I present here to answer on any other party’s behalf. I have to do my job, help the country progress, that’s where my need focus is right now.”

Putting his views about the upcoming UP polls and the politics surrounding it, the junior minister said, “I don’t think we have seen such an atmosphere in decades where attempts have been made to revive the cultural legacy of the nation. Kashi Vishwanath temple has been connected to the Ganga river through a corridor. The people of UP can very well differentiate between ‘Kaamdaar’ and a ‘Naamdaar.’”

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