New Delhi, June 11: Indicating that the airline industry is in a major crisis, the Civil Aviation Minister Praful Patel said on Wednesday he did not want any airline to shut down due to the rise in fuel price. The minister was speaking after meeting with Prime Minister Manmohan Singh to seek a cut in government taxes on air turbine fuel (ATF).

This is a crisis situation; the airline companies are facing a staggering loss of about Rs 4,000 crore and the ATF cost has become 50% of companies’ cost, he said. In such a situation, the airline companies will be forced to take steps to prune their costs.

Praful said the PM has asked him to wait for the meeting of empowered group of ministers. He said he had told the PM that govt’s intervention is required urgently.

He also said he would be approaching oil companies and the Petroleum Ministry on reducing the base cost of ATF. “We are also looking at reducing route navigation charges,” he added.

Earlier in the day, Kingfisher chief Vijay Mallya, reacting to the losses that Aviation industry has suffered, said, “Heavy losses of the Aviation industry is primarily due to the unprecedented increase in the price of jet oil. To make the matter completely worse, there is a huge element of taxation of government. Meeting with the Prime Minister is to request for tax relief.”

Jeh Wadia, Director of the Wadia group which owns GoAir, also reacted on the rise in the jet fuel prices and its effect on the rise in the prices of airline tickets. Wadia said, “We are rationalizing routes and hope for some relief on the sales tax and ultimately we hope that it would be achieved.”

Meanwhile, in a related development, low-cost carrier SpiceJet, which is expected to make a total loss of Rs 80-100 crore in the current fiscal, up from Rs 70 crore in the last financial year, due to higher ATF price, plans to curtail flights on various routes.

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