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Aviation sector hit hard in pandemic

25 Sep 2021 00:00:00 | Update: 25 Sep 2021 00:58:33
Aviation sector hit hard in pandemic
Mofizur Rahman – Rajib Dhar

The state of the local aviation sector was not smooth even before the Covid-19 pandemic. Several airlines faced closure due to many obstacles. The government should identify the obstacles, take rapid initiatives to fix those, and also provide policy assistance to help this sector grow, said Mofizur Rahman, secretary general of the Aviation Operators Association of Bangladesh and the managing director of NOVOAIR, in an interview with Hasan Al Javed of The Business Post. He also said the Civil Aviation Authority of Bangladesh (CAAB) should exempt airline companies from paying all charges for three years considering the pandemic impacts

The Business Post: The aviation sector is struggling amid the pandemic. How are Bangladeshi airlines, including NOVOAIR, coping with the situation?

Mofizur Rahman: All sectors are struggling due to Covid-19. Aviation and hospitality have been hit the hardest. The pandemic crippled the airline business. Several companies were shut down, and many are facing uncertainties in light of the current global coronavirus situation.

Many countries have offered aircraft operators multiple facilities, including financial assistance and exemptions of charges, to help the aviation sector recover from the pandemic blows. But no such support was offered in our country.

NOVOAIR flight operations remained suspended for more than 120 days last year and this year, but we still had to bear various expenses, including bank interests, staff salaries and allowances, aeroplane maintenance fees, etc.

Our domestic flights are now open, but we are not getting the desired number of passengers. In a word, Bangladeshi airlines are sinking.

TBP: The government has given Covid-19 incentives to different sectors. Have you got any from the government or the CAAB?

Mofizur: The aviation sector is considered one of the driving forces of economic growth in the world, but that is not the case in our country yet. Aviation companies have initiated some collective plans to cope with the current Covid-19 situation.

We have demanded several facilities from the government until the Covid-19 situation improves. For instance, we have sought nautical/aeronautical charge exemptions, loan moratorium, zero per cent duty on airplane spare parts, and withdrawal of extra tax on jet fuel costs compared to the international market. We have received some support from the government, but that is very poor.  

Aeronautical charges are generally higher in Bangladesh compared to the neighbouring countries. We are hopeful that the government will provide some policy support for us.

Besides, fuel prices are increased by Tk 5 every month. It seriously impacts the aviation business because fuel accounts for 40 per cent of the total flight operation costs.

TBP: What are the major challenges NOVOAIR is facing during the pandemic?

Mofizur: It is difficult to survive for aviation entrepreneurs in the current situation. To cope with it, we are always demanding policy support, but not cash assistance. Bangladesh’s aviation sector was not smooth even before the pandemic as many airline companies were shut down in the face of various problems.

The government should take steps to stop the exclusive dominance of Padma Oil Company in the market and allow multiple companies to sell jet fuel. Airline companies import parts and some other equipment that they are not supposed to pay any duty on. But the authorities concerned impose duties on those under various excuses.

Besides, aviation companies should be given long-term bank loans with the lowest interest and easy conditions.

TBP: When will you resume international flights?

Mofizur: Before the pandemic, NOVOAIR only operated flights on the Bangladesh-India route. But these flights are now suspended.

Several airlines are operating flights with India under air bubble agreements, but NOVOAIR is not one of them. We are preparing to operate regular flights with India once the situation improves.

TBP: Where do you want to see NOVOAIR in Bangladesh’s aviation sector in the future?

Mofizur: NOVOAIR is highly emphasising departure security and customer service. We introduced a frequent flyer programme named Smiles, web check-in, co-branded debit and credit card services, and the cheapest domestic travel packages.

That is why we have gained passengers’ trust to become the first choice when they fly on domestic routes. To retain that trust, we are working on diversifying the domestic routes to provide more convenient passenger service and a comfortable travel experience.

TBP: Two new airlines may start operations on domestic routes. What is your opinion on this as the secretary general of the aviation operators association?

Mofizur: No one can sustain in our aviation sector. GMG Airlines and United Airways are the prime examples. The Bangladesh Securities and Exchange Commission restructured the United Airways board, and now they can operate. But I am doubtful about whether they can operate with their current fleet.

Any investor can start an aviation business, but they have to do the groundwork first. Some investors made announcements but did not eventually launch operations. Those that did not care about the groundwork failed, but the government took no action against them. 

Local airlines depend on corporate, businessmen, and middle-income customers. They have already lost corporate and middle class customers due to the pandemic. I see no growth in this sector in the next 20 years.

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