Aviation, Tourism Sector: Budget blanks out recovery plan | The Daily Star
12:00 AM, June 05, 2021 / LAST MODIFIED: 02:54 AM, June 05, 2021

Aviation, Tourism Sector: Budget blanks out recovery plan

Say stakeholders, lament absence of financial packages to bail them out amid pandemic

Aviation and tourism have been hit perhaps the hardest by the pandemic. Airlines went bankrupt and airliners were sent into early retirements or long storages. Flights got cancelled due to measures meant to contain the spread of the virus and planes that flew, flew nowhere near the full capacity.

Zoom became the substitute for business travellers and planned holidays got postponed in the hope one day things would be normal again.

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Pristine sunny beaches remained devoid of tourists dealing a blow to the carriers and businesses that are absolutely dependent on tourism.

People have been laid off in thousands from this sector across the globe.

Yet, there was almost nothing in the proposed budget for fiscal 2021-22 about bailing out struggling businesses or even any hint of a direction the government was taking to bring back the glory days of this sector.

Leaders of the sector said they were utterly frustrated as the finance minister ignored tourism and aviation.

The allocation in the proposed budget was Tk 364 crore more than that of the previous budget – Tk 3,426 crore.

He spoke about developing the tourism industry in Bangladesh and building a world class air transport system. He also mentioned projects to increase the capacity of airports in the country.

There was no word on the bailout.

Biman lost Tk 1,300 crore since the pandemic hit and the losses incurred by two other carriers -- US Bangla and Novoair -- are in the several hundred crores, according to industry insiders.

For Biman, it is hard to imagine a worse time for the pandemic to hit.

Many of the 21 aircraft in its fleet, including Boeing 787s and De Havilland Canada DHC-8 (Dash-8), are quite new but they have been sitting on the tarmac more than they have been in the air.

Before the pandemic, Biman served 19 destinations. Now it serves 8.

Sources said the pandemic cost the tourism sector around Tk 20,000 crore. Tourism involves 40 lakh people.

Members of Tour Operators Association of Bangladesh (Toab) said they alone lost Tk 5,000 crore last year and if things don't change they could lose Tk 6,800 crore by December.

Airlines Operator Association of Bangladesh (Aoab) urged the government to waive VAT and tax on jet fuel on domestic routes. Aoab also demanded withdrawal of 15 percent VAT on aeronautical and non-aeronautical charges, and reducing the corporate tax rate from 32.5 percent to 22.5 percent.

"We are surprised to see this budget. There was actually nothing in this budget for the aviation and tourism sector … nothing on how to save these two worst effect industries," Kamrul Islam, spokesperson of US-Bangla Airlines, said.

Toab demanded stimulus package but the government did not pay heed to their demands.

The finance minister did mention that the government has formulated a standard operating procedure to keep domestic and international tourism going following health safety protocols.

Toab leaders said there was no mention of how and when it would be implemented.

Toab had asked for waiver of their annual trade licence renewal fees during the pandemic. This request too was ignored in the budget.

Talking to this correspondent, Toab President Rafeuzzaman said the government did not pay due focus on the tourism industry.

"Tourism sector is on the verge of collapse … . This sector will not survive without assistance from the government. But we didn't see anything in the budget," he added.

Toab leaders said tourism is now the third largest industry in the world. In 2019, tourism contributed 4.7 percent, or Tk 6,300 crore, to the GDP.

 

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