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Air India has announced that it will not operate flights from the new Noida International Airport (NIA) in June, instead choosing to focus on increasing traffic at its Delhi hub. The airline will operate its no-frills brand, Air India Express, from Noida and Hindon airports in addition to Delhi. However, Air India is seeking clarification from Adani Airport Holdings Limited on the relocation of flights from Mumbai to Navi Mumbai airport, which is set to open in June.
The airline is also asking the Uttar Pradesh government to reduce the Value Added Tax (VAT) on Aviation Turbine Fuel (ATF) to reduce fuel costs, which account for 40-45% of operating expenses. The current VAT rate is 25%. The new airport in Jewar, located southeast of Delhi and close to Greater Noida, is expected to become the capital’s second aviation hub, with commercial operations set to begin this year.
The relocation of flights from Mumbai to Navi Mumbai airport will also have a significant impact on the aviation industry. Air India’s decision to focus on its Delhi hub will likely lead to a significant increase in traffic and revenue for the airport. Additionally, the new airport in Jewar may attract passengers from the eastern suburbs of Delhi and nearby townships, providing a potential competitive advantage for the airline.
Overall, the decisions made by Air India and the Uttar Pradesh government will have a far-reaching impact on the aviation industry in India. The reduction in VAT on ATF will help to reduce fuel costs for airlines, while the new airport in Jewar will provide a much-needed boost to the region’s aviation infrastructure. The relocation of flights from Mumbai to Navi Mumbai airport will also lead to changes in the airline industry’s supply and demand dynamics, and it will be interesting to see how the industry responds to these developments.