The Ministry stated that the Centre has launched a number of steps to promote the aviation sector in a response to a question before the Lok Sabha on February 2.
State governments and union territories that impose a high VAT on aviation turbine fuel (ATF) accepted the reduction in VAT on ATF. As a result, 17 states and UTs have cut their ATF VAT. The response stated that the Goods and Services Tax (GST) rate has been lowered for domestic maintenance, repair, and overhaul (MRO) services from 18 per cent to 5per cent. The Ministry added that the Airports Authority of India (AAI) and other airport developers have projected a capital spend of roughly Rs 98,000 crores over the next five years for operations such as the reinforcement of runways and the development and alteration of new and existing terminals.
According to the ministry, the centre has also authorised the Emergency Credit Line Guarantee Scheme (ECLGS) for the aviation sector. According to the response, the scope of ECLGS has been expanded to provide credit support to these companies up to 100 per cent of their total credit outstanding (both fund-based and non-fund-based outstanding) as of reference dates, subject to a cap of Rs 1,500 crores per borrower, or whatever is lower. This change was made in response to industry demand.
