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SpiceJet gets the nod to import aviation turbine fuel directly. The approval will sure provide domestic customers as well as travellers taking flights to India from the airline’s two international destinations, a respite from rising fares.
The low-cost Indian carrier, SpiceJet on Wednesday became the first airline that gained the nod of the Government of India to import aviation turbine fuel (ATF) directly.
SpiceJet is known for offering the cheap airfares and stays quite popular among budget travellers taking flights to domestic destinations as well as cheap flights to India from its two international destinations – Colombo and Khatmandu.
As per the Internet sources, the airline is in talks with many leading oil marketing firms and is hoping to commence the import of fuel eventually.
By importing fuel from overseas markets, SpiceJet aims to bring down its operational cost considerably. This will come as a respite for those on business travel or leisure holiday as they would be able to net cheap flights tickets on domestic routes as well as on flights to India from Colombo and Khatmandu.
SpiceJet will likely get jet fuel from Reliance Industries Ltd (RIL) which happens to be the sole private oil-marketing brand. The company was reportedly in talks with many carriers in February to provide jet fuel infrastructure and transport services at the airports.
The Indian carriers were so far required to compulsorily buy ATF from public sector oil companies which levied sales taxes to the tune of 22-24 per cent making jet fuel in India one of the most expensive globally (only second to Bangladesh, average 27% tax on ATF).
Direct import of fuel for consumption would help Indian airlines in saving up to Rs 13,000 on every tonne of ATF as per the current rates.
Jet fuel costs form 40 percent or higher of the operating costs of the Indian airlines; its growing cost remains the key reason for disturbing health of the aviation sector.