According to Ankur Bhatia, Executive Director, Bird Group:
The budget for 2012-13 is definitely better-than-expected. The finance minister has kept the focus on infrastructure funding and social sector with rational increase in taxes.
Cabinet’s decision on reducing the cost of direct import of aviation turbine fuel will help loosen the heavy tax burden on airlines and domestic players will be allowed to tap foreign loans on working capital, which is a very positive move.
Further, ECB to recast the debit is beneficial for Indian banks and will work for airlines to reduce the interest burden.
Concession on maintenance, repair and overhaul (MRO) setup will make India very competitive in this sector.
However, 49 percent of FDI in aviation industry is still under consideration which may impact the overall growth of the sector.