The government proposes to levy a 2% additional levy on all domestic and international tickets to fund its bid to boost regional aviation connectivity, according to the draft civil aviation policy released on Friday.
The policy comes as airline passenger numbers increased 20% a year to 38.8 million in the first half of 2015, leaving India’s major airports, which account for four-fifths of traffic, saturated.
The government also proposed hiking foreign direct investment in domestic airlines to over 50% under the open skies policy based on a reciprocal arrangement from the partner country.
Incentives to fly to small towns at affordable costs and easing the norms for domestic carriers to operate services abroad are some of the other highlights of the new draft policy unveiled by civil aviation minister Ashok Gajapathi Raju.
One of the policy’s primary aims is ensuring a tariff of no more than Rs 2,500 a ticket for each flying hour to destinations with “un-served and under-served” airports and airstrips. It also contains a host of incentives and other benefits to airport developers and operators to make this happen.
“The basic behind of National Civil Aviation Policy is to take flying to the masses,” civil aviation secretary Rajiv Nayan Choubey said, adding operators will get some doles to fly to smaller towns with incentives linked to fuel prices and inflation.
“A lot of consultation has taken place. We invite suggestions from stakeholders and public -- since it involves the people of India. After all those suggestions come in, we will look into it,” civil aviation minister Raju said.
The policy set an ambitious target of increasing the sale of air tickets from the current annual figure of 7 crore to 30 crore by 2022 and 50 crore by 2027.