The New Nation: Aviation businesses ask for more subsidies to save the industry

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The rising airfare in the country as a result of soaring jet fuel price will hamper aviation and tourism sectors’ booming. Price of jet fuel has increased by Tk 25 per litre in the last three months, while 120 per cent in the last 18 months.

© Md Manik/SOPA Images/LightRocket via Getty Images File photo: A view of Shahjalal International Airport in Dhaka.Airfare also has been increased parallel with the hiking trend of jet fuel during the pandemic. Airfare increased by about 100pc during the Covid era. Padma Oil company, the sister concern of Bangladesh Petroleum Corporation increased jet fuel price by Tk 13 recently. The fuel price is Tk 122 in the international market while the government is selling it Tk 100 per litre with subsidies, sources say.

Meanwhile, aviation businesses requested the government to reduce jet fuel price by increasing subsidies to save the aviation and the tourism sectors. The jet fuel price was Tk 46 per litre in October 2020 while it is now selling at Tk 100. About 40 per cent of the operational cost of the aviation sector is dependent on fuel. So, the hiking trend of fuel price could directly influence airfare. Industry insiders have urged the government to reduce fuel price by giving more subsidies or reducing VAT in domestic routes. There were about 319,708 metric tonnes of demand for jet fuel in the country in 2021, all of which was dependent on importing. About 40 per cent of the operational cost of a plane is dependent on its costs of fuel.

It may be noted that there was Tk 2,700 as lowest plane fare on the Dhaka-Jashore and the Dhaka-Syedpur routes before the Covid-19 pandemic which are now hiked by Tk 4,800 in the both routes. Similarly, it was Tk 3,700 as lowest plane fare on the Dhaka-Cox’s Bazar route before the pandemic which now stands at Tk 5,800. Migrant workers are the main victims of jet fuel hiking. So, the government in that case should subsidise the jet fuel price.

From all corners lives of ordinary people are becoming harsher and harder.

Aviation businesses ask for more subsidies to save the industry (msn.com)