Airlines Crisis: Iran war, Middle East crisis is situating the Indian aviation sector in crisis. Airlines are facing severe pressure due to rising fuel prices. In this background, the airlines are warning the central government that the flight operations will come to a standstill due to the fuel prices.
At least three airlines, including Tata Group’s Air India, have complained to the government. Aviation fuel “Aviation Turbine Fuel (ATF) prices have been sought to be revised. 40 percent of the cost of flight operations is fuel. Industry sources say that it has now increased to 55–60% of operating costs.
The airlines have written to the Union Ministry of Civil Aviation to this effect. Airlines have warned that if fuel prices rise, they will have to suffer huge losses and have to cancel flights. Along with Air India, Indigo and Spice Jet have also written to the Centre. Airlines say that the impact is particularly high on international routes, and if this continues, they may have to stop or reduce flights on the routes.
Some of the key demands made are that domestic and international ATF prices should be equal, temporary postponement of 11 percent excise duty, reduction of state level VAT which is up to 25 per cent in some areas and control on increase in fuel prices. The rise in fuel prices is due to the Iran war. Iran’s blockade of the Strait of Hormuz has severely affected oil from the Gulf. 20 percent of the world’s oil and gas is transported through this route.
