Uttarakhand@25 | How IIT Roorkee is shaping minds and building the future

India’s aviation sector is facing mounting cost pressure as jet fuel prices surge amid global volatility. Airlines, represented by the Federation of Indian Airlines (FIA), have flagged serious concerns over the current pricing mechanism of Aviation Turbine Fuel (ATF), which they say is creating a sharp imbalance between domestic and international operations. While domestic ATF prices were partially increased in the latest revision to protect local travel demand, international flights have been subjected to the full global price hike, significantly impacting airline margins on overseas routes.Adding to the challenge are operational hurdles such as restricted airspace over Pakistan, longer rerouting due to tensions in West Asia, and the depreciation of the rupee, which increases dollar-denominated costs. Airlines are also demanding the reintroduction of the “crack band” system, which earlier capped refinery margins between $12 and $22 per barrel to prevent extreme price volatility.Alongside pricing reforms, the industry has called for temporary suspension of the 11% excise duty on ATF and reduction in high state VAT rates, which range up to nearly 29% in key aviation hubs. While flight operations continue, airlines warn that sustained high fuel costs could lead to fare increases and network adjustments, particularly on international routes. The situation highlights the growing pressure on India’s aviation sector amid rising global fuel prices and domestic tax burdens.