Fuel price pinches boom in the sky | india | Hindustan Times
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Fuel price pinches boom in the sky

The FIA said the tax-policy’s impact on the cost of ATF in India, has become extremely critical to the industry’s future, reports Gaurav Choudhury.

india Updated: Dec 10, 2007 22:59 IST
Gaurav Choudhury

Airlines, most of which are struggling to heal their bleeding balance sheets, have demanded rationalisation of taxes in aviation turbine fuel (ATF) prices.

Since revision of aviation turbine fuel prices on December 1 by oil marketing companies, a kilolitre of ATF now costs Rs 47,444.14 in Delhi and Rs 53,371.47 in Mumbai. Similarly, ATF prices for international carriers have shot up by 12 to 13 per cent in the country. Following the hike, domestic carriers in the country have imposed a fresh fuel surcharge of Rs 300 on all tickets across segments in the country from December 1. In October, airlines had imposed an Rs 150 fuel surcharge.

The Federation of Indian Airlines (FIA), an industry body representing India’s airlines, said that the tax-policy’s impact on the cost of ATF in India, has become extremely critical to the industry’s future.

“Successive years of deep financial strain for the Indian carriers have limited the resources available. The Indian carriers need resources for investments in enhancing passenger servicing; investment in new facilities; in retention of employees; and for investments in expanding air connectivity in India”, it said in a memorandum submitted to the government.