Two moves-one by the state government and another by the Airport Authority of India-may give boost to aviation sector in Jharkhand,increasing the air traffic from the Ranchi based Birsa Munda Airport.

In the first move,the state government has decided to reduce the Value Added Tax(VAT) on Aviation Turbine Fuel(ATF) used by the aircrafts from 20 percent to four percent.A notification in this regard is likely to be issued soon.

This means reduction in the cost of fuel.In effect,it is bound to be welcomed by the aviation companies . Since no such decision was taken by the West Bengal,the companies such as JET,Go Air and Air India can divert their flights from Kolkata to Ranchi.

In the past,Maharashtra,Gujarat and Chattisgarh had reduced the VAT on ATF and thereby attracted a number of aviation companies to start air service from their airports.

In the second move,AAI’s chairman VP Agrawal is on record having said that if the Jharkhand government reduced the VAT on ATF,the AAI will not collect parking charges from the aviation companies.Agrawal had made an announcement in this regard during inauguration of the new terminal building in Ranchi last week.

“With reduction of VAT on ATF and free parking facility at the Ranchi airport,the air service providers will have no option than to prefer Ranchi over Kolkata”,says Ashish Nandy of the Jet Airways echoing the sentiments of managers of other aviation companies.


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