‘Help us stay afloat’

Top officials of the country's three private airlines yesterday placed a five-point demand before a parliamentary watchdog to keep the air operators afloat.

The points include reducing jet fuel price and charges imposed by the Civil Aviation Authority of Bangladesh (CAAB).

Authorities of the airlines made the demand at a meeting of the parliamentary standing committee on civil aviation and tourism ministry at Sangsad Bhaban.

On behalf of them, Aviation Operators Association of Bangladesh (AOAB), undersigned by its secretary general Mofizur Rahman and vice-president Abdullah Al Mamun, placed a written proposal describing various challenges for which the private airlines are struggling for survival.

About the high price of jet fuel, AOAB said the country's private airlines are on the verge of going extinct due to the high price. Spending on jet fuel amounts to around 50 percent of an airline's operational cost.

"Besides, 30 to 40 percent more is spent on jet fuel for operating domestic flights in Bangladesh, when compared to the average international spending," it adds.

Mofizur Rahman, also managing director of Novoair, said they are bound to buy jet fuel only from Padma Oil. Different airlines could buy jet fuel from sellers of their choice if the buying process was open.

"Airfares are not affordable due to the high jet fuel price. Therefore, passengers on different routes have gone down significantly," he also said.

According to sources, in the last 26 months, Padma Oil Company Limited increased the price of jet fuel 17 times. The company raised the price by 170 percent during this period.

About high aeronautical and non-aeronautical charges of CAAB, Mofizur said, airlines are struggling for survival due to the sky-high surcharge rate imposed by the regulatory authority.

The annual surcharge rate is 72 percent. Due to this, airlines have no chance to turn around, once they fall into debt.

In Bangladesh, airlines have to pay aeronautical, landing and parking charges at high rates, when compared to similar charges in different countries of the region, sources at different private operators told The Daily Star.

The airlines of India pay no landing and parking fees for aircraft with 80 or fewer seats.

Aeronautical and non-aeronautical charges in Bangladesh are seven times higher than those of neighbouring country India, added the source.

AOAB also mentioned costly imports and high duties for which airlines are having a hard time.

Besides, spare parts of airlines are being imported through letter of credit, which is not acceptable anywhere in the world at present, it also said.

Sources said an airline needs to import hundreds of spare parts for rectification and overhaul. Sometimes, it takes months to obtain permission for importing.

Costly imports and delays are other reasons behind the struggling private airline business, AOAB said.

In most cases, an airline has to pay duties at high rates for importing spare parts.

According to the import policy, aircraft spares enjoy zero tax. But in reality, airlines need to pay tax amounting to 15 to 150 percent of the price in some cases.

AOAB also mentioned unfair competition between Biman and private airlines regarding fixing airfare. This is also a major reason behind the setback.

The parliamentary body later recommended sitting with the National Board of Revenue and discussing the demands.

The JS watchdog sat with the top airline officials for the first time in the 11th parliament to get a first-hand account on the challenges and prospects of the aviation sector.

Imran Asif, CEO of Air Astra, and Lutfor Rahman, CEO of US-Bangla Airlines, among others, were present at the meeting, with Awami League MP RAM Obaidul Muktadir Chowdhury in the chair.

In 1997, the first private airline -- Aero Bengal -- spread its wings in the sky. During the last 25 years, 10 more private operators entered the cash-intensive business.

But only two private airlines, aside from the new Air Astra, managed to survive, while eight had to fold business.