IATA's Positive Reaction: The International Air Transport Association (IATA) Director General has welcomed this decision. He noted that the relief will benefit airlines by lowering operational costs associated with service imports.

Impact on Airlines: Foreign airlines will now enjoy tax exemptions or reductions on services such as ground handling, aircraft maintenance, and other operational services. This is expected to lead to more competitive pricing and better service offerings.

Support for Industry Growth: The GST relief aligns with India's broader objective to support the aviation industry. By easing the tax burden, the government aims to stimulate growth and enhance the attractiveness of the Indian market for international airlines.

Encouraging Foreign Investment: This policy is anticipated to attract more foreign investment in India's aviation sector. Lower tax costs can make it more appealing for international airlines to expand their operations and routes in the country.

Operational Cost Reduction: The relief is expected to significantly reduce the operational costs for airlines. This can lead to lower ticket prices for passengers and increased flight frequency, benefiting the overall travel experience.

Enhanced Competitiveness: By reducing tax-related expenses, foreign airlines will have a better chance to compete with domestic carriers. This enhanced competitiveness could lead to improved service quality and customer satisfaction.

Future Prospects: The GST relief is seen as a step towards broader tax reforms in the aviation sector. It may pave the way for additional policy adjustments that support the industry's growth and efficiency.

Government's Commitment: This decision reflects the government's commitment to facilitating international trade and investment. It underscores the importance of the aviation sector as a key component of India's economic strategy.

Industry Reactions: Industry stakeholders are optimistic about the potential positive effects of this relief. The move is expected to foster a more dynamic and competitive aviation market in India.

Conclusion: The GST relief for foreign airlines is a significant development, welcomed by IATA and expected to enhance competitiveness and reduce costs in the Indian aviation sector.