International aviation hubs should be created in India: Ajay Singh

Ajay Singh, chairman, SpiceJet, during an interview with Swati Khandelwal of Zee Business, spoke about his view on global investment in India and the International Monetary Fund growth forecast. Edited Excerpts:

There is a pitch for investment in India, but there is a need for a stable policy for it. What is your view on it?

The Indian government has done a commendable and unique job in the past five years. This is something to be proud of. I feel India has emerged as a bright and shining spot in the world when the world is facing certain problems like the tension between the US and China or Brexit in the UK, among others.

But are we leveraging on the opportunity?

We should leverage more on the opportunity. Under such situations, we must move out and tell the world about the kind of changes that India has seen in the last five years like the passage of goods and services tax (GST) legislation and implementation of the bankruptcy law. The changes also include the opening of bank accounts under the Jan Dhan scheme, unique identity (UID) for every citizen, electrification of villages, toilets, health policies, road development at a fast pace and, of course, the Swachh Bharat programme.

IMF, in its recent forecast, said India will grow by 7.3% in this fiscal. Do we have the potential to achieve the number?

I think, it is time we should look beyond 7.5-8% levels, and the next government should take the growth rate to at least 10%. In fact, we should have a target to grow India by 10% for the next 10 years.

Do you feel that the excise duty on aviation turbine fuel (ATF) will be reduced?

ATF should be brought under the ambit of GST and the Union government is trying to do so. But, everyone knows that it can happen only if a consensus is reached at the GST Council. The majority of the states are ready for it except a few, which are opposing the proposal. I think we will have to reach them and lobby for the purpose. In addition, the sector should be strengthened by creating international hubs in the country such as Delhi, Mumbai, Bangalore, Hyderabad, instead of exporting it. Currently, India's international hubs are present in Dubai, Abu Dhabi, Singapore and Bangkok. This also means that Indian airlines should have the ability to fly directly to Europe, America and other places and the government should help us on that front.

The aviation industry is going through a difficult phase at present and the quarterly results indicate that. What is your outlook for the sector, especially when crude prices are going up?

The industry is facing a tough situation, but the airlines are not sitting idle and some airlines such as SpiceJet and IndiGo are inducting new technology aircraft that will consume less oil. On the other hand, we are also trying to increase our revenues and be profitable. Legacy airlines are facing difficulties as their economics is different from us. Domestic airlines should be provided with a level-playing field in terms of cost when compared with other airlines. In addition, the Indian aviation sector's potential is different from others as it is growing by 20% at least when just 3% of Indians are flying today.

Jet Airways is looking for cash and they are talking to many sources like Tata Group, Etihad and SBI, among others. Are you looking at Jet Airways?

Absolutely not, because we are a small airline company while Jet Airways is quite bigger than us, and thus their problem is too big to be borne by SpiceJet. We wish them luck and hope that they reach a solution to their problem at the earliest. When it comes to Mr Naresh Goel and his family, don't take them lightly as they have faced such situations on multiple occasions, and have been successful in pulling out the airlines from it.

But time is ticking as they have just two more months in hand?

Whatsoever the problem is, I am sure that all of them, including the stakeholders, promoters and the government are working very hard to pull Jet out of the problem.

Any expectations of a rate cut from Reserve Bank of India (RBI)?

See, it depends on RBI, but a rate cut is going to be beneficial for the industry. However, you will have to take a long-term view in which inflation remains good. And, several economists feel that this is not the right time for a rate cut.