Fuel Costs Now 55-60% Of Operating Costs; Airlines May Withdraw From Unsustainable Routes: FIAOct 6, 2026, 10:54 IST
The letter stated, "The Federation of Indian Airlines (FIA), representing Air India, IndiGo and SpiceJet, respectfully seeks your urgent intervention to address the unprecedented financial impact confronting the Indian airline industry arising from the continuing conflict in West Asia since April 2026, airspace restrictions and diversions, rupee depreciation, rising operational costs and exorbitant price rise in aviation fuel. FIA sincerely appreciates the Government’s initial interventions, including measures relating to ATF price cap of 25% over March 2026 pricing from Apri 01, 2026 to June 08, 2026, reduction of VAT on ATF in Delhi and Maharashtra to 7% (for six months), and the direction for a 25% reduction in landing and parking charges for domestic flights for the period April’26 to July’26. Given that the underlying geopolitical and fuel-price pressures continue, it is critical that these measures are continued and strengthened to prevent further deterioration in the financial position and operational resilience of Indian carriers. Over the past several months, FIA has made detailed representations to the Government highlighting the severe impact of these factors on airline operating costs and financial sustainability. The fuel component alone, which historically constituted approximately 30–40% of airline operating costs, has increased to around 55–60% under the prevailing circumstances. In addition, airspace restrictions have resulted in longer flight routes, leading to higher fuel consumption, increased crew costs, and lower aircraft utilization. Airlines are also facing additional pressure from the depreciation of the Indian Rupee, as key expenses such as fuel, aircraft leases, maintenance, and insurance are largely linked to the US Dollar." IndiGo on Monday had announced a hike in fuel surcharge for domestic and international flights in the wake of rising jet fuel prices. The revised charges will be effective from today and will push airfares higher. The quantum of the price hike ranges from Rs 100 to Rs 350 for domestic flights depending on distance. The hike in surcharge has also been impacted for international flights, the airline said in a statement. Get Latest News Live on Times Now along with Breaking News and Top Headlines from Business, Economy and around the World. Shafali Nigam is a Senior Correspondent with the Times Group, covering civil aviation, education, women and child affairs, and politics. With over sev... View More





