rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » Jet chief on what ails India's aviation sector

Jet chief on what ails India's aviation sector

Last updated on: July 25, 2012 17:18 IST

Jet chief on what ails India's aviation sector

     Next

Next

Steep operational costs and low air fares in India are causing sustained losses for domestic airlines, Jet Airways chief Naresh Goyal said on Wednesday.

"While the growth outlook for our industry is very promising, Indian carriers are faced with stiff headwinds, both from the cost and revenue standpoint, which pose a serious risk to realising the potential," he said at a Confederation of Indian Industry conference on 'Building the future of Indian aviation'.

Click NEXT to read further. . .


Photographs: Punit Paranjpe/Reuters

     Next

Jet chief on what ails India's aviation sector

Prev     Next
Prev

Next

On the high costs facing the Indian airline industry, Goyal said the factors included a depreciating rupee against the dollar, escalating jet fuel prices, high taxes and rising infrastructure costs.

While aviation infrastructure had improved considerably, "these improvements have come at a very steep price for both airlines and consumers in the form of significantly higher fees and charges," he said.

Click NEXT to read further. . .


 


Image: Air India's Airbus A321 (L) and Boeing 777-200 LR aircraft.
Photographs: Punit Paranjpe/Reuters
Tags: , Goyal , India

Prev     Next

Jet chief on what ails India's aviation sector

Prev     Next
Prev

Next

On the other hand, the Jet chairman said domestic air fares in India were 'far cheaper than fares in other large aviation markets for sectors of similar distances.'

Giving an example of a domestic sector with a distance of over 2,000 kms, he said compared to India, the air fares in China were 87 per cent higher, in the US 119 per cent higher, in Canada 162 per cent higher and in Australia 182 per cent.

Click NEXT to read further. . .


Image: Naresh Goyal.
Photographs: Reuters

Prev     Next

Jet chief on what ails India's aviation sector

Prev     More
Prev

More

He said thus Indian carriers operate in an environment where the operating costs are much higher than other large aviation markets, while the fares are lower.

"The combined effect of these has been sustained losses for the Indian carriers."

If these additional costs were passed on to the passengers, it would "only dampen or stifle demand, as the airlines themselves cannot absorb any of these costs due to their fragile financial conditions," he said.




Tags: India

Prev     More
© Copyright 2014 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.