Business Aviation is for the Elite: An Ill Founded Conception

Government and public’s misconception of Business Aviation being an ideogram of luxury is certainly ill founded because business leaders of India who own their own private jets frequently choose to travel by scheduled airlines. This misconception has also been responsible for the current woes of the Business Aviation industry as its rightful and just demands are often met with an ill-conceived phrase ‘Business Aviation is for the elite, so it deserves to be taxed”. It is indeed ironic that an industry where a Rs 100 spend on Aviation can result in Rs 325 worth of total benefits for the country or where 100 direct jobs in aviation can result in 610 jobs overall (source – draft civil aviation policy 2014-15), is today facing  a negative growth in Business Aviation sector.  It is grappling with regulation and taxation hurdles to an extent that operators are either opting to close down or get their aircrafts registered outside India.  Economically viable skilled labor and its favorable geographical location puts India in an advantageous position to become an aviation maintenance hub for itself and neighboring countries. However instead of taking advantage, our tiring policies and steep tax structure are ensuring that instead of India,  countries like UAE, Sri Lanka, Malaysia and Singapore become maintenance hubs. Airworks, a leading MRO in India, opened many new bases in the year 2014 alone, however, none of these opened in India. They were all opened in the neighboring countries.

This misconception is also the prime reason why, despite positive pre budget indications,  Arun Jaitley at the last hour, failed to cut custom duties on private aircrafts and give tax benefits to MRO`s. Had he delivered on the market sentiment, almost all woes of this lagging industry would have fallen into place. The pilot project of the new Government, “Remote Area Connectivity” would have also taken off in the right earnest. Yet again, the ‘misconception - for the elite’ ruled over.

Drawing the perception of “luxury” owners aside, this sector services the need of air ambulances, tourism, remote area connectivity, industrial surveys (pipe lines, transmission lines, geo mapping), off-shore operations, rescue and relief operations, anti naxal operations and more. Industrialists too, use business aircrafts either to locations where there is poor connectivity or if the fixed timings of scheduled airlines unsuitably restrict quick travel. Those who understand the relevance of ‘time is money”, would be easily able to appreciate how travelling in a small private aircraft to a destination with poor scheduled airline connectivity, translates into revenue in big businesses.

The misconception of excess and opulence that shrouds the Business Aviation needs to be cleared. Better understanding of how this sector influences the growth of the country’s economy and enables industrial growth is the key.

There is a pressing need for mobilisation of forums for public debates. If this does not happen soon, we may be repeating the mistakes of our closed economy of the past, while our competing countries continue to lure the businesses we have failed to capture.