Govt. should encourage growth of low-cost carriers

It is extremely important to stimulate traffic to and from Tier II & III markets.

The Financial Budget is always one of the most anticipated announcements of the year. Though the Union Budget is essentially a Statement of Account of public finances, it has historically become a significant opportunity to indicate the direction and the pace of India’s economic policy.

Below are some of the elements that I hope are addressed in the upcoming Union Budget, these are the areas that, I believe; if addressed would result in overall economic growth in our country.

Infrastructure is a major issue and the budget for infrastructure development should be allocated appropriately to ensure that the amazing Make in India campaign can turn into a reality sooner rather than later. If our infrastructure is improved our progress would be infinite. I believe the Government should also use its International clout to provide low cost funding to infrastructure projects with a corruption free environment. Some of the projects that should be given emphasis, in my view; are listed below.

1. Roads – a road map for planned growth taking into account a 25 year growth plan

2. Rail - Interstate, Intrastate, Intracity/Metrorail

3. Waterways – Major rivers should be connected

4. Airways - Focus on development of LCCs

5. Ports and shipping – Revamped Port facilities

6. Power plants - Nuclear, Hydroelectricity and Solar

7. Electricity – 100% electrified India

8. Improved accessibility to Potable water

9. Improved facilities at hospitals

10. Education

11. Internet connectivity across the country and Free Wifi in the top 200 cities to start with.

Another sector that calls for immediate attention is our agriculture industry which is deeply affected by the alarming rate of suicides resulting from several issues including micro loans, poor quality of seeds, and dependency on the weather. All efforts must be channelized towards increasing food production and making food grains easily accessible by all. I believe,the Government should ear mark agricultural space and encroachment free zones to boost production levels while exploring additional agricultural subsidies, access to HGV seeds, subsidised fertilizers, economical farm implements and adequate water for irrigation.

Before I speak on the aviation sector I would like to just touch base on a few other areas that I believe are crucial to the growth and development of our country –

• Promote start up and entrepreneurial ventures in Tier II and III cities

• Investment in cyber security with increased focus on Digital India

• Expedite implementation of GST to eliminate the multi-layered tax structure

Coming on to aviation, it is well known that the Aviation industry is a catalyst for growth. Today, India ranks as the 9th largest civil aviation market globally, with a market size of around $16 billion and in 2015, our domestic airlines saw an increase of 20% in terms of passenger load.

However, the aviation industry still remains disadvantaged due to regulatory barriers, poor infrastructure hampering regional connectivity, high fuel prices, ATF amongst others.

I am of the opinion that it is extremely important to stimulate traffic to and from Tier II & III markets. In terms of tax reforms, VAT on aviation fuel must be made uniform across states. If taxes such as service tax and VAT are subsidised/abolished by the government, the Indian MRO industry will attract business from international clients creating yet another multiplier effect in our economy.

The author is Chief Executive Officer and Managing Director at AirAsia India