Covid-19 Impact: Government to Come Up with Rescue Package to Resuscitate Aviation Sector By CIOReviewIndia Team

Covid-19 Impact: Government to Come Up with Rescue Package to Resuscitate Aviation Sector

CIOReviewIndia Team | Thursday, 19 March 2020, 08:58 IST

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Coronavirus pandemic has forced countries globally to close borders and bring air travel near to a stop. This has caused many Governments over the world to foster some rescue planning for their respective aviation sector. Similarly, two government sources have told Reuters that Indian Government is also planning for a rescue package worth of USD 1.6 Billion for the Aviation sector which has been stormed down due to the outbreak of the virus.

As told by viable sources, proposal to temporarily suspend the most taxes levied on the sector, including deferment of aviation, fuel tax is also being put into consideration by the Finance Minister. Also, the rescue package worth of USD 1.6 Billion has proposed by India’s civil aviation ministry.

 One of the sources has also said that the companies could be allowed to pay the taxes interest-free in the coming tax cycle. “Taxes could be deferred till the coronavirus spread is contained and the aviation sector can come back to its feet,” he added.

Till date, Covid-19 has infected over 2 lakh people, out of which, almost 8,500 deaths have been recorded across 164 nations. When India is concerned, there have been more than 150 cases of infected people across the country, from which, three people have already lost their lives.

According to the International Air Transport Association (IATA) estimates, airless might need a bailout of more than USD 200 billion.Trump administration look forward to overcoming the financial impact that U.S airlines have been facing due to the ongoing crisis. They have sought approval from Congress for USD 50 billion in secured loans to U.S Airlines. Also, Airline Companies such as Vistara and budget carrier GoAir have suspended their international operations due to the virus outbreak. Indigo, who is currently the biggest carrier has also canceled many of its overseas flights and might be forced to park some of its planes due to the rapid fall in the domestic air travel.

Excluding state carrier Air India, CAPA estimates that every other Indian Airlines will suffer losses which can amount to USD 600 million, i.e., from the months of January to March, and could even worsen if the outbreak is not contained.

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