Air Travel To Get Expensive On Soaring ATF Rates

Air travel may get expensive in due time on rising prices of ATF. On Wednesday, oil marketing companies hiked air turbine fuel for the second time this month.

In the national capital, the price of jet fuel has been increased to Rs 90,519.79 per kilolitre from Rs 86,038.16 per kilolitre.In the other metro cities of Kolkata, Mumbai and Chennai, the price was increased to Rs 94,888.70, Rs 88,987.20 and Rs 93,371.18 per kilolitre, respectively.

This comes as a bad news for the already debt laden aviation companies' financials. Importantly, ATF rates are revised every fortnight. At present, the fuel cost accounts for more than 30% of the operating cost for airline companies. Also, as India charges the highest rate of taxes on ATF in the world, that adds to the cost factor.

So, to provide relief to the sector, the industry has been nudging the centre to bring ATF under GST regime as is the case for 'Banker Diesel'-i.e used in the shipping industry.