NEW DELHI: The Federation of Indian Airlines (FIA), which has IndiGo, Air India and Spicejet as its members, has cautioned the Civil Aviation ministry that they would be forced to stop operations on specific routes unless changes are effected in the methodology of Aviation Turbine Fuel (ATF) pricing. It has also called for expeditious disbursement of credit support to airlines under the Emergency Credit Line Guarantee Scheme (ECLGS 5.0).
Indigo has increased the cost of its tickets from Tuesday due to the soaring jet fuel costs.
Two separate letters have been sent by the FIA to the Ministry recently. FIA has requested that international benchmark pricing not be adopted and instead a cost plus agreed margin approach be adopted. In a letter sent on September 25, it pointed out that operating costs of airlines have surged of late with ATF remaining the single largest aspect. "If timely relief is not available, the airlines may be compelled to withdraw from several unsustainable routes," the federation cautioned.
The FIA has also appealed for a reinstatement of the relief measures effected by the government for the aviation industry in the first quarter of this fiscal. The measures taken by the government, including an ATF price cap of 25 per cent over the March 2026 pricing from April 1- June 8, reduction of VAT on ATF in Delhi and Maharashtra to 7 per cent (for six months), and a 25% reduction in landing and parking charges for domestic flights for the April-July period this year.
Pointing out to the precarious situation faced on the financial front by airlines, a second letter from the federation to the ministry on October 1sent by its Director Ujjwal Dey said, “The urgency of the prevailing situation warrants immediate action to ensure that eligible and desirous member airlines can access funds under the scheme without avoidable delays.
While those member airlines who have sought credit under the ECLGS 5.0 scheme have received a portion of the assistance sanctioned under the scheme, the release of the balance amounts has, in several cases, been delayed due to continued hesitation on the part of lending institutions.” Therefore it is imperative that the ministry facilitates the timely release of funds under the ECLGS 5.0 scheme, it pointed out.
