Local aviation industry
Saturday, 19 December 2009
Sohail Imran
UNLIKE in many other countries, why Bangladesh's private sector airlines did not grow at a rapid pace bothers many. It was quite natural for Bangladesh to expect that the local aviation industry would grow to compete with the other countries. But it has not happened. Many people think that restrictive government rules and regulations are to blame for this failure. Much of the aviation market concerning Bangladesh is controlled by foreign airlines. According to rough estimates, the state-run Biman has no more than 28 per cent of the market. The share of the local private sector airlines is less than 10 per cent.
People in private sector airlines say that unfavourable public policies and regulations obstruct the growth of the local private sector aviation industry. The aviation industry of Bangladesh can grow rapidly, given government supports, they say. No other country allows foreign airlines to thrive at the cost of local airlines.
Bangladesh can facilitate the growth of its airlines without violating its open air policy. The government can and should increase the frequency of local airline flights. This would provide space for the local private sector airlines to grow. Bangladesh Biman is unable to operate all its flights on domestic and international routes. With limited access to routes private airlines cannot grow as they could. Private airlines need government support to grow as in the other countries.
Aircraft, with less than 80 seats, do not have to pay for takeoff, landing and parking in India. Why Bangladesh does not extend similar facilities to its fledgling privately owned local airlines is difficult to understand. Private airlines also deserve cuts on 10 per cent tax on the import of aircraft parts. The capital market support also could help this sector. There should be better access to bank loans. Banks should extend credit on the basis of goodwill of an airlines.
The government needs to formulate a policy to facilitate rapid growth of the local private aviation industry.
UNLIKE in many other countries, why Bangladesh's private sector airlines did not grow at a rapid pace bothers many. It was quite natural for Bangladesh to expect that the local aviation industry would grow to compete with the other countries. But it has not happened. Many people think that restrictive government rules and regulations are to blame for this failure. Much of the aviation market concerning Bangladesh is controlled by foreign airlines. According to rough estimates, the state-run Biman has no more than 28 per cent of the market. The share of the local private sector airlines is less than 10 per cent.
People in private sector airlines say that unfavourable public policies and regulations obstruct the growth of the local private sector aviation industry. The aviation industry of Bangladesh can grow rapidly, given government supports, they say. No other country allows foreign airlines to thrive at the cost of local airlines.
Bangladesh can facilitate the growth of its airlines without violating its open air policy. The government can and should increase the frequency of local airline flights. This would provide space for the local private sector airlines to grow. Bangladesh Biman is unable to operate all its flights on domestic and international routes. With limited access to routes private airlines cannot grow as they could. Private airlines need government support to grow as in the other countries.
Aircraft, with less than 80 seats, do not have to pay for takeoff, landing and parking in India. Why Bangladesh does not extend similar facilities to its fledgling privately owned local airlines is difficult to understand. Private airlines also deserve cuts on 10 per cent tax on the import of aircraft parts. The capital market support also could help this sector. There should be better access to bank loans. Banks should extend credit on the basis of goodwill of an airlines.
The government needs to formulate a policy to facilitate rapid growth of the local private aviation industry.