Rs 49k cr losses put India aviation sector on verge of collapse

The civil aviation sector in India is on the verge of collapse with accumulated losses of Rs 49,000 crore and needs an urgent boost to prevent more Kingfisher-type meltdowns and job losses, Prime Minister Narendra Modi was told on Saturday.

The review meeting saw civil aviation minister Ashok Gajapathi Raju pointing out that poor returns from airports, burgeoning costs and a tax structure that hurt Indian maintenance, repair and overhaul industry was burying the sector under debt.

Raju is understood to have compared the situation with what the telecom sector faced in 1999 before the then Vajpayee government worked out a rescue package that allowed mobile service providers to move from fixed fees to revenue sharing.

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