Hyderabad: Telangana on Wednesday inked a memorandum of understating (MOU) with the Ministry of Civil Aviation and the Airports Authority of India, joining the Centre’s UDAN-Regional Connectivity Scheme (RCS) in New Delhi.
The MoU was intended to put the development of smaller airports such as the ones proposed at Kothagudem and Warangal on fast track as part of the move to give a big push to air connectivity for smaller towns.
The tripartite MoU was signed by Usha Padhee, Joint Secretary, Ministry of Civil Aviation, Arvind Kumar, Principal Secretary, Investment Promotion (Telangana State) and Dr Guruprasad Mohapatra, Chairman, Airports Authority of India (AAI).
Thanking the Union Minister for Civil Aviation P Ashok Gajapati Raju on the occasion for the Centre’s move to reach out to smaller towns as part of the New Civil Aviation Policy (NCAP), the Minister for IT and Industries, K T Rama Rao said State would extend all support to the initiative.
The State government was keen on setting up new airports in towns that were found to have economic viability and feasibility. Thanks to the support extended by Ashok Gajapati Raju, technical clearance was accorded to Kothagudem airport.
He said people from the districts flying to different far off destinations were flocking to Hyderabad. The RCS would help reach out to them in a big way over a period of time.
Stating that skilling was the priority for the aerospace industry under the NCAP, he stressed on the need for setting up skilling academy at the Begumpet airport. The Centre has already assured to consider it.
Regional Connectivity Scheme
The primary objective of the scheme is to facilitate regional air connectivity by making the services affordable by supporting airline operations through concessions by the Central and State governments and airport operators to reduce the cost of airline operations on regional routes and through financial support to meet the gap.
Payment of the VGF will be made by the implementing agency to the beneficiaries – selected airline operations from the Regional Connectivity Fund (RCF). The State government would have to reimburse the applicable share.
All parties would make all possible effort in providing easy and quicker approvals for increased participation and timely commencement of operations under the scheme.
The State government would ensure fulfilment of its commitment to VGS timely and completely as required under the scheme.
The State government should reduce VAT to one per cent or less on the Aviation Turbine Fuel (ATF) at the RCS airports and for RCS flights from other Airports located within the State for a period of ten years.
The State government should provide minimum land, if required free of cost and free from all encumberences along with security and fire services free of cost.
The Central government shall provide its share of VGF under the scheme which shall be 80 per cent of the total requirement for the State.
The Central government shall levy an excise duty at a rate of 2 per cent on aviation turbine fuel purchased by the selected airline operators besides, providing concession on service tax on tickets i.e, abatement of service tax on 90 per cent of the taxable value for an initial period of one year from the date of notification of the scheme.