Engine trouble' led to Lagos crash

The plane faced two minor incidents in America

Emergency workers in Nigeria used cadaver dogs and cranes to search for corpses on Monday at the site where an American-built airliner plunged to earth, killing all 153 aboard. Rescue officials said they fear many more people may have perished on the ground.

The pilots reported engine trouble before the plane crashed on its way into Lagos. Two years ago, the same Boeing MD-83 lost engine power due to a bird strike, according to an aviation database.

On a clear Sunday afternoon, the Dana Air jetliner smashed into businesses and crowded apartment buildings near Lagos' Murtala Muhammed International Airport, the worst air disaster in Nigeria in nearly two decades.

The cause of the crash remained unclear. The pilots radioed to the Lagos control tower just before the crash, reporting engine trouble, a military official said. Rescue workers searched for the aircraft's black box recorders where flight data is stored, said Harold Demuren, Director-General of the Nigerian Civil Aviation Authority.

Aviation databases show the plane was exported to Nigeria in early 2009. It was first delivered in 1990 with the U.S. registration number N944AS to Alaska Airlines and it suffered two minor incidents while in the Seattle-based airline's service. On Nov. 2, 2002, the plane made an emergency diversion due to smoke and electrical smell in the cabin, and on Aug. 20, 2006, the plane was evacuated after landing at Long Beach, California because of smoke in the passenger cabin.

http://www.thehindu.com/todays-paper/tp-international/article3491586.ece

Three striking Air India pilots appear before DGCA

New Delhi: Three striking pilots of Air India, sacked by the national carrier, on Monday appeared before the DGCA and explained their position on the show-cause notices issued to them by the aviation regulator, official sources said.

The Directorate General of Civil Aviation (DGCA) had asked these pilots, who are senior members of the de-recognised Indian Pilots Guild (IPG) that is leading the pilots' strike, to appear before it and explain why their flying licences should not be cancelled for not joining duty.

They were also asked to explain why they had not replied to the show-cause notices issued to them on May 12. The pilots "explained their position" on the show-cause notices when the appeared before DGCA chief EK Bharat Bhushan, the sources said without elaborating.

Similar notices were issued to seven other sacked pilots after Air India wrote to DGCA to seek an explanation from them as to why their licences should not be cancelled for not reporting to work. These seven pilots had submitted their replies to the notice last week.

After they started reporting sick from May seven as part of their agitation on career progression issues, the IPG was de-recognised and the services of 101 pilots were terminated.

With Air India pilots striking over issues relating to their career progression, government announced a roadmap for implementing the recommendations of the Justice DM Dharmadhikari Committee on measures to integrate the pay-scales and seniority issues of the staff of the two erstwhile state-run airlines -- Indian Airlines and Air India.

http://ibnlive.in.com/news/three-striking-air-india-pilots-appear-before-dgca/264333-7.html

Aviation ministry proposes slashing jet fuel taxes

The ministry has sought opinion from stakeholders on reducing state taxes on jet fuel to a uniform 4%, according to a discussion paper posted on its website

New Delhi: Civil aviation ministry has proposed slashing state taxes on jet fuel, which may significantly bring down costs for ailing local airlines that are reeling under a debt load of $20 billion and annual losses of $2 billion.

The ministry has sought opinion from stakeholders on reducing state taxes on jet fuel to a uniform 4%, according to a discussion paper posted on its website.

Different states impose sales tax at varying rates on aviation turbine fuel, going as high as 30%. High fuel expenses, contributing nearly half the costs incurred by airlines, has compounded woes for the sector struggling with intense competition.

“Reduction in the fuel tax would allow the Indian carriers to become competitive in servicing passengers to their respective hubs within India and compete with international carriers. This advantage would allow them to increase their market share,” the paper said.

The ministry has also proposed to abolish service tax on air tickets, which according to the paper, makes air travel “a luxury rather than an efficient mode of transport.”

Service tax, including fuel surcharge, is currently Rs. 773 or 10.3% of the total fare, whichever is lower, for an economy ticket on international flights.

India has already allowed carriers to import jet fuel directly and has proposed letting foreign airlines invest in local carriers, hoping the moves will aid the embattled sector.

Analysts estimate that the move to allow direct imports could reduce costs by 15 to 20% as airlines would not have to buy fuel from oil marketing companies, which are mandated to levy various federal and state taxes.

http://www.livemint.com/2012/06/04121229/Aviation-ministry-proposes-sla.html?h=A1

Aviation Ministry pitches for 4% tax on jet fuel in six metro airports

New Delhi, June 4:

The Ministry of Civil Aviation estimates that a uniform four per cent sales tax on aviation fuel at the six metro airports will generate economic benefit of over Rs 40,000 crore and more than offset the Rs 1,500-crore annual loss to the exchequer.

In a recent report, the Ministry estimates that rationalisation of sales tax at four per cent will lead to creation of between 20,000 and 30,000 jobs which could have an economic impact of Rs 700-1,000 crore a year.

In addition, the improved share of Indian carriers in India's international traffic is likely to result in increase of revenues of up to Rs 12,000 crore annually.

At the moment the sales tax on ATF varies from four per cent to 30 per cent across the country.

“While reducing the base price would be difficult at this juncture, a uniform four per cent sales tax across all States can be achieved by giving ATF a ‘declared goods' status. This will help in reducing the impact of high aviation fuel price. This suggested revision in the taxation policy will reduce the accrual of taxes to the respective State exchequer. However, there would be significant benefits of this policy to the regional and local economies, as well as to the overall Indian economy,” the paper states.

It further argues that a reduction in sales tax would lead to reduction in fares and also enhance the financial strength of Indian carriers.

“This would generate substantial economic benefit to the region and the industry as a whole in the long run,” the paper points out.

With fuel accounting for 40 per cent of the total operating cost for Indian carriers, a reduction in sales tax from an average of 20 per cent to uniform four per cent will bring down the fuel cost for domestic flights by around 13 per cent, the paper estimates.

“Assuming that airlines pass on the full benefit of this reduction in cost to passengers, domestic air fares will come down by six per cent (since fuel accounts for 40 per cent of the total operating cost). Using price elasticity studies of air travel demand, it is established that a six per cent drop in airfare will lead to a 5-8 per cent increase in air traffic for domestic airlines,” the paper estimates.

http://www.thehindubusinessline.com/industry-and-economy/logistics/article3490334.ece?homepage=true&ref=wl_home

Singapore Airlines, SilkAir introduce special pre-monsoon offers

Mumbai, June 4:

Singapore Airlines and SilkAir have introduced special pre-monsoon offers for China and Singapore at an all-inclusive return Economy Class fares from Rs 38,888 for a person.

The limited period offer includes destinations such as Beijing, Changsha, Chengdu, Chongqing, Guangzhou, Kunming, Shanghai, Shenzhen, Wuhan and Xiamen.

The offer is valid for travel on Singapore Airlines or SilkAir from Ahmedabad, Bangalore, Chennai, Coimbatore, Hyderabad, Kochi, Kolkata, Mumbai, New Delhi and Thiruvananthapuram. To avail this offer, customers must make their bookings by June 15 for travel from July 1 to September 30.

A minimum of two passengers must travel together for the whole itinerary and return within one month from the commencement of travel from India. The fare is inclusive of all taxes and surcharges.

Singapore Airlines currently operates 53 weekly flights from six cities in India.

SilkAir, the regional wing of Singapore Airlines, is a full-service airline that currently operates 33 weekly flights from seven cities in India.

http://www.thehindubusinessline.com/todays-paper/tp-logistics/article3491331.ece

Aviation Ministry pitches for 4% sales tax on jet fuel in 6 metros

New Delhi, June 4:

The Ministry of Civil Aviation estimates that a uniform four per cent sales tax on aviation fuel at the six metro airports will generate economic benefit of over Rs 40,000 crore and more than offset the Rs 1,500-crore annual loss to the exchequer.

Economic impact

In a recent report, the Ministry estimates that rationalisation of sales tax at four per cent will lead to creation of between 20,000 and 30,000 jobs which could have an economic impact of Rs 700-1,000 crore a year.

In addition, the improved share of Indian carriers in India's international traffic is likely to result in increase of revenues of up to Rs 12,000 crore annually.

At the moment the sales tax on ATF varies from four per cent to 30 per cent across the country.

“While reducing the base price would be difficult at this juncture, a uniform four per cent sales tax across all States can be achieved by giving ATF a ‘declared goods' status. This will help in reducing the impact of high aviation fuel price. This suggested revision in the taxation policy will reduce the accrual of taxes to the respective State exchequer.

“However, there would be significant benefits of this policy to the regional and local economies, as well as to the overall Indian economy,” the paper states.

It further argues that a reduction in sales tax would lead to reduction in fares and also enhance the financial strength of Indian carriers.

“This would generate substantial economic benefit to the region and the industry as a whole in the long run,” the paper points out.

With fuel accounting for 40 per cent of the total operating cost for Indian carriers, a reduction in sales tax from an average of 20 per cent to uniform four per cent will bring down the fuel cost for domestic flights by around 13 per cent, the paper estimates.

“Assuming that airlines pass on the full benefit of this reduction in cost to passengers, domestic air fares will come down by six per cent (since fuel accounts for 40 per cent of the total operating cost).

“Using price elasticity studies of air travel demand, it is established that a six per cent drop in airfare will lead to a 5-8 per cent increase in air traffic for domestic airlines,” the paper estimates.

http://www.thehindubusinessline.com/todays-paper/tp-economy/article3491297.ece