Telangana to cut VAT on ATF to 1 per cent, eyes more flights from city

Passenger traffic at Hyderabad International Airport has tripled from 7 percent to about 21 percent over the last four years.

Hyderabad: The Telangana government will reduce the Value Added Tax (VAT) applicable on Aviation Turbine Fuel (ATF) from 16 per cent to 1 per cent in order to attract more passengers. This announcement was made by IT minister K.T. Rama Rao at the 10th-anniversary celebrations of GMR Hyderabad International Airport Ltd (GHIAL) held on Friday.

“I am happy to announce that the VAT on aircraft fuel, which is currently 16 per cent in the state of Telangana, will be reduced to 1 per cent immediately,” Mr Rao said. This move will help airlines reduce their operational costs, of which fuel expense is a major component.

GHIAL on Friday announced that it would be making an investment of '2,000 crore to increase passenger handling from the current 18 million to 26 million within the next few years.

S.G.K. Kishore, the CEO of GHIAL told media persons, “We have reviewed the master plan for the Hyderabad Airport, which was supposed to handle 40 million passengers. We are looking at an 80 million passenger handling capacity through the introduction of a second terminal.”

Passenger traffic at Hyderabad International Airport has tripled from seven per cent to about 21 per cent over the last four years. In the last ten years, the airport has evolved from a mere point of transit to an economic hub that drives the socio-economic growth of the state.

Chief Minister K. Chandrasekhar Rao laid the foundation stone for the expansion of the airport as well as for the construction of an exhibition and convention centre on the occasion of its 10th anniversary. He also released a commemorative stamp and cover to celebrate the airport’s “decade of excellence.”

GMR also launched the Hyderabad Airport City project for the establishment of a greenfield airport city including an integrated ecosystem consisting of a business port, a health port, an education port, a fun port, a logistics port and an aerospace port.

The GMR Varalakshmi Foundation, the CSR arm of the GMR Group, signed Memorandums of Understanding with Schneider Foundation, Volvo and Jacquar Foundation during the event.

Speaking on the occasion G.M. Rao, the chairman of the GMR Group, said, “We are elated that Hyderabad airport, India’s first greenfield project under the PPP model, has completed its glorious decadal journey and is considered an iconic gateway of south and central India. We remain committed to inclusive and sustainable growth, thereby contributing to our honourable CM’s vision of ‘A Golden Telangana.”

Hyderabad International Airport was commissioned in a record time of 31 months, in March 2008. It had an initial capacity of 12 million passengers and 1,50,000 million tonnes of cargo per annum.

( Source : Deccan Chronicle. )
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