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"Industry On Verge Of Stopping Ops': Airlines' SOS To Centre
On April 26, 2026, the Federation of Indian Airlines urged the Civil Aviation Ministry to intervene with financial relief and uniform ATF pricing, warning that ad hoc pricing could ground flights. By April 28, 2026, media reports said airlines including Air India fear they may stop operations due to high ATF costs, with calls for price revisions and relief tied to the Middle East crisis.
Why It Matters
High fuel costs and policy pricing can force airlines to halt operations, impacting travel and economy. The situation shows how geopolitical tensions can affect aviation economics and government intervention may be required.
Timeline
2 Events
Article reports airlines warn they may stop operations due to high ATF costs; calls for price revision and relief
April 28, 2026
The article reports that the aviation sector in India is on the verge of stopping operations as ATF prices rise, with Tata-owned Air India among the three airlines represented by the FIA. They have asked the government to revise ATF pricing, noting that ATF contributes about 40 percent to operating costs. To relieve the pressure, the airlines advocate a uniform pricing method across domestic and international flights, recalling the earlier 'crack band' approach. Long-haul routes are identified as the most affected. The document notes government limits such as a Rs 15 per litre cap on domestic ATF price, and a Rs 73 per litre increase for international ATF, along with a call to defer the 11 percent excise duty on ATF.
FIA letter to Civil Aviation Ministry seeking ATF pricing relief and financial support
April 26, 2026
The Federation of Indian Airlines (FIA), which represents Air India, IndiGo and SpiceJet, sent a letter to the Civil Aviation Ministry dated April 26. It warned that any ad hoc pricing (domestic vs international) or irrational increases in ATF prices would lead to insurmountable losses, grounding of aircraft, and flight cancellations. The FIA requested urgent government intervention and immediate financial support to survive. It also pressed for a uniform ATF pricing method across domestic and international operations, referencing the past use of a 'crack band' mechanism. The airlines proposed temporarily defering the 11 percent excise duty on ATF to ease the burden. The concerns are framed as a direct result of the US-Iran war and Iran's blockade of the Strait of Hormuz, which affects global oil supply and trade routes, particularly to Asia.