Partial ATF price hike ensures domestic operational costs of Indian carriers remain manageable: Govt

The Ministry of Petroleum and Natural Gas on Wednesday announced a calibrated 25 per cent increase in Aviation Turbine Fuel (ATF) prices for domestic scheduled carriers, a move welcomed by the Indian aviation industry amid global energy market disruptions due to the West Asia situation.

The Ministry of Civil Aviation has stated that the Centre’s decision to allow only a partial increase of 25 per cent on ATF prices for domestic airlines provides “critical relief”, and the move will “prevent a potential industry-wide crisis”.

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“The decision enables airlines to maintain competitive fares for domestic travelers by avoiding additional fuel surcharges that a fully market-linked pricing mechanism may have triggered,” said Asangba Chuba Ao, Joint Secretary, Ministry of Civil Aviation, while addressing an inter-ministerial briefing in the national capital on the situation arising out of the conflict in West Asia.

With over 4.5 lakh passengers flying daily on domestic routes, the measure safeguards passenger interests, supports operational and financial stability of airlines, and ensures continued air connectivity for cargo, trade, and the broader economy, he said.

“The Indian aviation industry has welcomed the Government of India’s decision to implement a limited increase of 25 per cent in ATF prices for domestic scheduled carriers on domestic routes,” the Joint Secretary, Ministry of Civil Aviation said.

He further stated that this measure provides critical relief amid unprecedented global energy price surges arising from disruptions in West Asia.

The intervention ensures that domestic operational costs of Indian carriers remain manageable, he said.

“For Indian Carriers where fuel typically accounts for nearly 40 per cent of total operating expenses for Indian carriers; the calibrated increase helps prevent a potential industry-wide disruption,” the Joint Secretary, Ministry of Civil Aviation said.

He mentioned that the limited increase of 25 per cent on ATF price enables airlines to maintain competitive pricing for domestic travellers, avoiding the need for additional fuel surcharges that would have been necessary under market-linked pricing.

Indian airlines have conveyed that such calibrated measures are essential for maintaining operational stability and financial sustainability in a challenging global environment, while also safeguarding passenger interests and strengthening sectoral resilience, the Joint Secretary, Ministry of Civil Aviation said .