The world's airlines have committed to achieve carbon neutral growth by 2020, the head of the global aviation body IATA said on Monday.

Demand will continue to increase, but any expansion of our carbon footprint will be compensated, Giovanni Bisignani told the annual general meeting of the International Air Transport Association in the Malaysian capital.

But Bisignani said wide cooperation was needed from allied industries and governments.

Air navigation service providers must make it possible to fly even more effectively. Fuel companies must supply eco-friendly fuels and governments must give us access to credits in global carbon markets.

Aviation is responsible for about 2 percent of global greenhouse gas pollution and that share is expected to rise.

Bisignani said biofuels had the potential to reduce aviation's carbon footprint by up to 80 percent but he criticized governments for lack of investment in biofuels research.

Governments, particularly the European Union, and leading green groups are demanding the sector clean up its act and the U.N.'s aviation agency, ICAO, has been tasked with crafting global sectoral approach to fighting emissions from planes.

IATA backs a four-pillar strategy that includes investment in technology and positive economic measures, such as carbon trading, and wants emissions dealt with on a global basis to ensure a level playing field for all airlines.

The EU has said aviation emissions will come under the bloc's emissions trading scheme from 2012, a decision that has angered many airlines which feel they will be unfairly saddled with extra costs.

We must account for emissions at a global level, not by state, said Bisignani.

Airlines should get carbon credits for every cent they pay whether in taxes, charges or emissions trading scheme payments. We should pay only once, not several times, he added.

He said the aviation industry had made significant commitments with concrete targets, with the first being to improve fuel efficiency by 1.5 percent each year until 2020.

But we recognize that improved fuel efficiency is not enough. Our emissions must stop growing.

He also attacked governments, particularly Britain, for taxing the airline sector while giving nothing back to green investment.

He said Britain's Air Passenger Duty had increased to 2.7 billion pounds ($4.3 billion).

It is unacceptable that money collected from our responsible industry in the name of the environment is being used by an irresponsible government to pay inflated MP expense claims or bail out banks.

The aviation body chief said the industry would cut emissions by 7 percent this year, 5 percent because of reduced capacity as a result of the economic crisis and 2 percent as a result of a strategy to reduce emissions.

IATA groups 230 of the world's airlines.

(Reporting by Raju Gopalakrishnan and David Fogarty; Editing by Lincoln Feast)

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