Indian Government permits Kingfisher Airlines, Spicejet, IndiGo to directly import aviation fuel

Posted: April 22, 2012 in Airlines, Asia, India
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NEW DELHI: Three Indian carriers, which have been permitted to directly buy jet fuel from foreign sources, would together import almost 13 lakh kilo litres (kl) of the fuel at a cost of about Rs 5,780 crore for the present. 

The three carriers have been negotiating with leading oil marketing companies

The three carriers have been negotiating with leading oil marketing companies

The carriers which have recently received permission from the Directorate General of Foreign Trade (DGFT) under the Commerce Ministry, to import aviation turbine fuel (ATF) are Kingfisher Airlines, SpiceJetand IndiGo.

Air India, which has also applied for such an approval, is yet to receive permission to import ATF. The move will help the airlines to significantly slash its operating costs.

“All the three airlines have been permitted to directly import ATF,” a senior Commerce Ministry official told a reporter.

While InterGlobe, owner of no-frill airline IndiGo, got approval to import 7.15 lakh kl worth Rs 3,200 crore of jet fuel, cash-strapped Kingfisher has been allowed to buy five lakh kl worth Rs 2,233 crore. SpiceJet would import only 50,000 kl worth Rs 235 crore, the official said.

The three carriers have been negotiating with leading oil marketing companies and were hopeful of beginning fuel imports in due course, a source said.

Industry experts have claimed that a mix of taxes levied by state-run oil marketing companies and the state governments make jet fuel prices in India among the highest in the world.

Currently, fuel costs account for about 40 per cent of an airline’s total operating costs.

Read the full story from India’s ‘The Economic Times’….


The Economic Times
22 APR, 2012


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