Hyderabad: The Telangana Government on Wednesday signed an MoU with the Ministry of Civil Aviation and Airports Authority of India under the Regional Connectivity Scheme (RCS) for air connectivity by developing small airports and airstrips in the State.
The Memorandum of Understanding (MoU) was signed here in the presence of Civil Aviation Minister Ashok Gajapathi Raju and Telangana Minister for IT and industries K T Rama Rao in the national capital, an official announcement from the state government said.
The RCS a key component of the National Civil Aviation Policy would be in operation for a period of 10 years, envisages providing connectivity to un-served and under-served airports of the country through revival of existing air-strips and airports.
This would be achieved through a financial stimulus in the form of Central and State government concessions, as well as Viability Gap Funding to the interested airlines to kick-off operations from such airports, so that the passenger fares are kept affordable.
The fare for a one hour journey of approximately 500 km on a fixed wing aircraft or for a 30 minute journey on a helicopter would now be capped at Rs 2,500, with proportionate pricing for routes of different lengths / duration, an official release had earlier said.
To reduce the cost of operations, the Central Government would be providing concessions in the form of reduced excise on VAT, service tax and flexibility of code sharing at the RCS airports. Similarly, the State governments would have to lower the VAT on ATF to 1 per cent or less, besides other concessions.
During the signing in ceremony, KTR thanked Raju for granting technical clearance for Kothagudem Airport.
He also urged the Civil Aviation Ministry to lease out the hangers at Begumpet Airport to the State Government so that skill development academy can be set up there using the infrastructure.