New Delhi (Gurpreet Singh): India’s aviation sector is facing mounting financial stress as soaring Aviation Turbine Fuel (ATF) prices and geopolitical tensions threaten to disrupt airline operations, prompting an urgent call for government support.
In a strongly-worded communication to the Ministry of Civil Aviation, the Federation of Indian Airlines (FIA), which represents major carriers including Air India, IndiGo and SpiceJet, warned that some airlines could be pushed to the brink unless immediate relief measures are introduced.
The industry body said a steep rise in fuel prices, coupled with heavy taxation and rupee depreciation, has made operations increasingly difficult for carriers.
According to the FIA, while domestic ATF price hikes were capped at Rs 15 per litre last month, international aviation fuel prices surged by Rs 73 per litre, creating a major pricing imbalance and raising concerns over the viability of both domestic and international routes.
The pressure has deepened amid tensions in West Asia, which have driven up global crude prices and sharply increased aviation fuel costs.
Airlines said fuel, which earlier accounted for nearly one-third of operating expenses, now makes up close to 60 per cent of total costs, placing unprecedented strain on the sector.
Describing the situation as critical, the FIA said rising fuel bills, disruptions in airspace and a weaker rupee have compounded financial losses for carriers.
Seeking immediate intervention, the federation has urged the Centre to restore the earlier “crack band” pricing mechanism to regulate refinery margins and stabilise ATF prices.
It has also sought a temporary suspension of excise duty on aviation fuel, arguing that the tax burden is worsening the crisis as prices continue to rise.
The airline body also flagged high VAT rates on ATF in major aviation hubs, saying fuel taxation remains a major hurdle to operational sustainability.
Warning of serious consequences if corrective steps are delayed, the FIA said airlines may be forced to cut flights, reduce routes and scale back networks, potentially impacting connectivity for passengers nationwide.
The appeal highlights growing pressure on India’s aviation sector at a time when travel demand remains robust but cost pressures are intensifying, with airlines urging swift policy support to prevent wider disruption.
