India's largest airline IndiGo announces withdrawal of fuel charges on domestic, international routes

India's largest airline IndiGo on Thursday (Jan 4) declared that it was cutting the fuel charges on all its domestic as well as international flights with immediate effect.

The decision by the airline company comes as a relief for passengers as it would reduce airfares by approximately 12.01 USD (Rs 1,000) on certain long routes.

IndiGo introduced fuel charges on domestic and international flight tickets in the month of October last year to compensate for the rise in jet fuel prices.

The latest announcement came after the recent reduction in Aviation Turbine Fuel (ATF) prices.

"As ATF prices are dynamic, we will continue to adjust our fares and components thereof, to respond to any change in prices or market conditions," IndiGo said in a statement.

The Indian carrier was also the very first airline to announce they would levy fuel charges to offset the rise in ATF prices.

Around 3.60 USD (Rs 300) was charged from each passenger if the flight distance was up to 500 kilometres and 4.80 USD (Rs 400) was levied for a distance of 501-1,000 kilometres.

For 1,001-1,500 kilometres, the charge was 6.61 USD (Rs 550 ), for 1,501-2,500 kilometres it was 7.81 USD (Rs 650) and 9.61 USD (Rs 800) for 2,501-3,500 kilometres.

With the removal of the fuel charges from the airfare, the ticket price for an IndiGo passenger will now come down by at least 3.60 USD (Rs 300) and up to 12.01 USD (Rs 1,000).

Civil Aviation Ministry's advise

In December 2023, the Civil Aviation Ministry called on the airline carriers to keep the interests of passengers in mind while deciding on the fares.

Civil aviation minister Jyotiraditya Scindia informed the Lok Sabha last month that airfare was neither established nor regulated by the government.

"The fares are fixed by airlines keeping in mind the market, demand, seasonality and other market forces. The airfare increases with an increase in demand of seats as the lower fare buckets get sold out faster and move to higher fare buckets," he had said.

"Airlines have also been sensitised to exercise moderation in pricing and to keep passenger interest in mind. The airlines have committed to ensuring that airfares do not surge during events such as natural disasters, calamities, etc," he added.

IndiGo, while announcing the introduction of the fuel charge on Oct 5, 2023, said the decision was on account of a significant increase in ATF prices.

"ATF accounts for a substantial portion of an airline's operating expenses, necessitating fare adjustment to address such a cost surge," it had said.

(With inputs from agencies)