The Centre confirmed that all refineries in India are running at full capacity with ample crude stocks to ensure a steady supply of petrol, diesel, and LPG across sectors. Additionally, the Civil Aviation Ministry disclosed that the Union Cabinet has sanctioned a one-time budgetary aid of up to Rs 10,000 crore to assist Indian airlines in stabilizing ATF prices. This move comes in response to the volatile global fuel prices influenced by the West Asia crisis.
The approved mechanism is a temporary solution where the government will offer interest-free advances to oil marketing companies to maintain stable ATF prices for domestic and international flights. In cases where international ATF rates surpass the benchmark, the fund will compensate oil companies, while any price reduction will lead to fund recovery through a transparent process back to the Consolidated Fund of India.
Emphasizing that this is not a subsidy but a stabilization measure, officials highlighted that the initiative aims to mitigate extreme price fluctuations in global fuel markets. By ensuring price predictability for airlines, especially in times of geopolitical uncertainty, the measure is anticipated to enhance operational efficiency and curb sudden airfare hikes, benefiting various categories of passengers.
The decision is expected to not only stabilize airfares but also maintain air connectivity throughout India, including remote areas, thereby supporting economic activities and inclusive growth. Furthermore, it is projected to have broader economic advantages by bolstering employment in aviation, tourism, logistics, and related sectors, while enhancing both domestic and international air links. Additionally, it will aid in optimizing airport infrastructure, including facilities developed under the UDAN scheme.
