India approves $1 billion fund to help airlines weather fuel cost surge
The one-time support will back state-run fuel suppliers and recover advances later as jet fuel prices jumped 135% in May, officials said.
- On Wednesday, the Union Cabinet approved Rs 10,000 crore in budgetary support to state-run oil-marketing companies to stabilize aviation turbine fuel prices for scheduled Indian airlines operating domestically and internationally.
- The West Asia conflict pushed international ATF prices up 135% from Rs 60.5 per litre in March to Rs 142 per litre in May, with fuel costs now accounting for up to 60% of airline operating expenditure.
- Rising fuel costs forced Air India, Air India Express, and Indigo to collectively cut 250 daily domestic flights from June, while the Union Petroleum Ministry reported OMCs were incurring under-recoveries of Rs 30 per litre on domestic jet fuel.
- Under the new arrangement, airlines must procure ATF exclusively from OMCs for up to three years, "subject to annual review or until the advance amount is fully recovered, whichever is earlier," with prices capped at Rs 75.6 per litre.
- Union Petroleum Minister Hardeep Singh Puri stated the fund safeguards 77 lakh jobs and maintains air connectivity to Europe, North America, and Central Asia, with the government planning to recover advances once international fuel prices moderate.
43 Articles
43 Articles
India approves $1bn support package to shield airlines from fuel price volatility
India's cabinet has approved a one-time budgetary support package of up to INR100bn ($1.04bn) for oil marketing companies to help stabilise aviation turbine fuel prices for domestic airlines.
ABP News
Asian NewsRising fuel prices due to the ongoing crisis in West Asia are putting significant pressure on the aviation sector. Amid this oil crisis, the Modi government has taken a major decision. A cabinet meeting chaired by Prime Minister Narendra Modi on Wednesday (June 3) approved an ATF fund of ₹10,000 for oil marketing companies. This fund will help oil marketing companies maintain stable ATF prices. The purpose of releasing the fund is to protect air…
India approves $1 bn fund for airlines as fuel costs surge
NEW DELHI — India approved a $1 billion support package for airlines on Wednesday to cushion the impact of soaring aviation fuel costs triggered by the Iran war.The conflict has engulfed the oil-rich Middle East and choked the Strait of Hormuz, through which one fifth of the world's oil usually passes, sending aviation turbine fuel (ATF) prices soaring.The crisis has sparked concerns over carrier profitability and led to a hike in fares.The one-…
India approves US$1bil fund for airlines as fuel costs surge
NEW DELHI: India approved a US$1 billion support package for airlines on Wednesday (June 3) to cushion the impact of soaring aviation fuel costs triggered by the Iran war. The conflict has engulfed the oil-rich Middle East and choked the Strait of Hormuz, through which one fifth of the world's oil usually passes, sending aviation turbine fuel (ATF) prices soaring. The crisis has sparked concerns over carrier profitability and led to a hike in fa…
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