Aviation fuel price to be slashed

By Our Special Correspondent

NEW DELHI, JAN. 19. The Union Cabinet tonight decided to slash the price of aviation turbine fuel for small turbo prop aircraft, with a view to make air services to the north-east and other remote areas economically viable.

The price-cut would be in two components. First, the Petroleum Ministry would issue instructions to provide the fuel at international prices, which is almost half the existing domestic price. Then the fuel would be notified as a ``declared good'' under the Central Sales Tax Act, so that the Sales Tax on it would come down to four per cent or even less across the country, as against the present scenario where several States even charged upto 34 per cent.

Announcing this, the Union Minister and spokesperson of the Government, Mr. Pramod Mahajan, said the move should give a major push to air links with not only remote areas, but also small cities. At present, because of the high cost of the fuel, airlines were not able to break even even at 100 per cent capacity.

The Cabinet also approved the feasibility report of the transmission system associated with the Talcher II thermal power project at a cost of Rs. 3,086 crores. The 2000 MW project is located in the eastern region in Angul district of Orissa, and the entire power is allocated to South India, including Karnataka and Tamil Nadu.

Besides, the Cabinet cleared a proposal to form a joint venture among the Department of Telecom Services (DTS), Inter-University Net (IUNET), Ministry of Information Technology (MIT) and educational institutions, to set up a nation-wide band-width data network to provide high speed data access to educational institutions, private and public corporations and service providers for learning, teaching and research purposes. Called the Sankhya Vahini India Limited, the company will have an authorised capital of Rs. 1,000 crores and a paid up capital of Rs. 300 crores. The major share of 49 per cent equity will be held by IUNET, followed by 45 per cent by DTS, four per cent by educational institutions and two per cent by MIT. The IUNET is a 100 per cent subsidiary of Carnegie Mellon University in US.

The Cabinet also cleared a protocol with Swiss Confederation for avoidance of double taxation with respect to taxes on income, approved a proposal for laying of underground crude oil pipeline on 4,400 sq metres of defence land in Saurashtra infantry lines in Jamnagar in Gujarat for connecting Gujarat, Mathura and Panipat refineries, and gave the nod for stage five of the Teesta hydroelectric project in Sikkim. The 510 NW project comprising three 170 MW power units would be set up at an estimated cost of Rs 2198 crores at April 1999 price index, the Minister said.

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