New draft civil aviation policy announced today aims at reducing cost of flying for middle class

Zee Media Bureau

New Delhi: The draft of new Aviation policy was unveiled by government today. The focus of the policy is expected to be on cutting down the cost of operations for airlines and expanding regional connectivity across the country. The policy will be open to comments from the industry and various stakeholders before the final policy will be shaped.

Government has proposed hiking FDI in domestic airlines to over 50 percent in open skies policy.

The new policy is likely to announce tax breaks for maintenance, repair and overhaul service providers as well as regional carriers, which will be periodically reviewed as and when required. By cutting down the cost of operations, the policy aims to increase connectivity between smaller cities within a flying distance of of one hour of flying.

According to industry sources, the air-fares between these cities will be capped at Rs 2,500 per passenger and the balance of the cost will be paid back to these airlines by the government through the levy of a cess on national and international flights. The plan is to levy a cess of 2% on passengers taking commercial flights.