The government has cut windfall profit tax on export of diesel and ATF to their lowest while also reducing the levy on domestically-produced crude in line with softening international oil prices, according to an official order. The levy on crude oil produced by companies such as Oil and Natural Gas Corporation (ONGC) has been cut to Rs 4,350 per tonne from Rs 5,050 per tonne, the order dated February 15 said. Crude oil pumped out of the ground and from below the seabed is refined and converted into fuels like petrol, diesel and aviation turbine fuel (ATF).
An airlines industry body has sought reduction in customs and excise duties on aviation turbine fuel and allowing private firms to supply it to bring down prices.
That it has been threatening to review this rule for a while is old hat anyway.
The government has cut the windfall profit tax on crude oil produced in the country while the levy on exports of diesel and ATF has been hiked, an official notification said. The tax, levied in the form of special additional excise duty or SAED, on domestically produced crude oil was reduced to Rs 6,700 per tonne from Rs 7,100 a tonne. SAED on the export of diesel was increased to Rs 6 per litre from Rs 5.50 a litre and on jet fuel or ATF to Rs 4 per litre from Rs 2, the notification said.
Domestic air passenger traffic touched 1.25 crore in January this year, an increase of 96 per cent compared to the year-ago period, according to rating agency Icra. However, it said the traffic remained around 2 per cent lower compared to the pre-Covid levels -- January 2020. The traffic stood at 64 lakh in January last year. Icra is maintaining a negative outlook on the Indian aviation industry, reflecting the view that the financial performance of Indian airlines is likely to remain under pressure in the near term, even though the recovery in domestic passenger traffic has been healthy.
The government has slashed the windfall profit tax levied on domestically-produced crude oil as well as on export of diesel and ATF following a drop in global oil prices, according to an official order. The levy on crude oil produced by companies such as Oil and Natural Gas Corporation (ONGC) has been cut steeply to Rs 1,700 per tonne from Rs 4,900, the order dated December 15 said. Crude oil pumped out of the ground is refined and converted into fuel like petrol, diesel and aviation turbine fuel (ATF).
Jet Airways said on Thursday it will increase fuel surcharge by Rs 150 on both Club Premiere and Economy Class tickets on domestic routes, with effect from May 4.
While jet fuel price was increased by Rs 2, subsidised LPG price has been hiked by Rs 4.50 per 14.2-kg cylinder. Non-subsidised LPG to cost Rs 93 more.
In five monthly reduction, non-domestic LPG rates have been slashed by Rs 170.5 per cylinder, bringing the price at three-year lows.
Jet fuel or ATF price on Wednesday was cut by almost 6 per cent after four rounds of monthly increases since July, while commercial cooking gas (LPG) rates were raised by a steep Rs 101.5 per 19-kg cylinder in line with international benchmarks. However, the price of domestic LPG - used in household kitchens for cooking purposes - remained unchanged at Rs 903 per 14.2-kg cylinder. Aviation turbine fuel (ATF) price was cut by Rs 6,854.25, or 5.79 per cent, in the national capital to Rs 111,344.92 per kl from Rs 118,199.17, according to a price notification of state-owned fuel retailers.
He said the ministry was looking forward to suggestions from the state governments and discussions were underway with all the stakeholders to arrive at a policy which would bring back growth in the aviation sector.
This is the second straight increase in ATF price this month. Rates were hiked by a record 56.5 per cent (Rs 12,126.75 per kl) on June 1. Simultaneously, petrol and diesel prices were hiked for the 10th day in a row.
Jet fuel constitutes over 40 per cent of an airline's operating costs and the price cut will bring relief to the cash-strapped carriers.
The change in the Foreign Trade Policy means that jet fuel sold in India to international flights will be treated as physical exports and not attract most of the domestic tariffs.
The government has reduced the windfall profit tax levied on domestically-produced crude oil as well as on the export of diesel and ATF, in line with softening international oil prices, according to an official order. The levy on crude oil produced by companies such as Oil and Natural Gas Corporation (ONGC) has been cut to Rs 1,900 per tonne from Rs 2,100 per tonne, the order dated January 16, said. Crude oil pumped out of the ground and from below the seabed is refined and converted into fuel like petrol, diesel and aviation turbine fuel (ATF).
InterGlobe Aviation, the operator of India's leading airline IndiGo, delivered a better than expected performance across most parameters in Q2FY24. The company posted its fourth consecutive quarter of net profit of Rs 188 crore. It had reported a loss of Rs 1,583 crore in the same quarter a year ago.
IndiGo share price today: IndiGo share price fell as much as 4.8 per cent to a low of Rs 4,275 per share on the BSE in Monday's intraday trade as investors booked profit in the stock post a its April-June quarter (Q1) results for financial year 2024-25 (FY25). The stock ended 1.36 per cent lower at Rs 4,430 as against a 23-points gain in the benchmark BSE Sensex. The selling also got exacerbated as the management commentary, post Q1FY25 results, highlighted that inflationary pressure could likely dent July-September (Q2FY25) performance.
Domestic air passenger traffic plunged around 43 per cent month-on-month at 64 lakh in January 2022 as the third wave of the pandemic and the resultant restrictions by state governments kept flyers away from air travel, Icra said on Tuesday. The domestic passenger volume in December 2021 was recorded at 112 lakh. The rating agency said it is expecting the recovery process to remain subdued during March quarter and that the jet fuel prices continue to be a drag on the sector. The passenger traffic declined 17 per cent last month over 77 lakh passengers transported by domestic airlines on local routes in January 2021, Icra said.
Shares of low-cost airline IndiGo hit record high on the bourses soon after reports of pilot crisis at Vistara emerged. The development also saw airfares surge by around 25 per cent on select routes. Shares of IndiGo hit a lifetime high of ~3,68.5 on April 2, 2024, and has gained 2.4 per cent on the bourses in April.
Govt may grant infrastructure status to the aviation industry to enable it to access finances at cheaper rates
Air India had last year faced about two-month-long strike by its pilots.
In Mumbai, jet fuel costs Rs 71,940.36 per kl as against Rs 73,306.89 per kl previously, IOC said.
Domestic air passenger traffic jumped 57 per cent to around 49 lakh in July, reflecting a significant sequential as well as year-on-year growth amid a decline in coronavirus infections, according to a report. Recording continued recovery, traffic rose 56-57 per cent to 48-49 lakh in July compared to June this year when it was about 31.1 lakh. As against June 2020, the growth is 132 per cent, rating agency Icra said in the report on Thursday.
In a bid to slash costs, Air India has hedged 10,000 barrels of jet fuel for its aircraft this month, four weeks after its Board gave a nod to the move.
Since international oil prices have fallen, the government's subsidy payout will fall by almost Rs 50 per cylinder to Rs 240.
Refuting all the allegations, IOC has clarified that no monopolistic situation exists in supply and pricing of aviation turbine fuel (ATF) to airlines.
In the next quarter, the country will also start gearing up for various Assembly elections could put the government as well as the OMCs under pressure
The Centre has garnered around Rs 2,500-3,000 crore in the first five weeks after it imposed a windfall tax on oil and gas companies for the export of fuel, Business Standard has learnt. It is likely that the government will continue with the one-time tax till the Indian crude basket is above $80 a barrel, sources said. The next review of the windfall tax on oil companies is early next week.
Most of them had to wind up operations due to high operating cost, expensive fuel and longer than expected gestation period.
With fewer passengers airlines bracing for a rise in operating costs due to a spike in crude prices
Apple's ambitious strategy to expand iPhone exports, shift more production from China to India at a faster pace, and grow its domestic market hits a Trump-sized roadblock.
The government has cut windfall gains tax on domestically-produced crude oil to nil while continuing the rate at zero on the export of diesel and ATF. The government has slashed the special additional excise duty (SAED) on crude oil produced by companies such as Oil and Natural Gas Corporation (ONGC) to nil from Rs 4,100 per tonne with effect from Tuesday, an official order dated May 15 said. This is the second time that the levy, which was introduced in July last year in the form of a cess to tax supernormal gains of oil producers and fuel exporters, has been cut to nil for domestically-produced oil.
The only fuel that showed growth was LPG as the government dole of free cooking gas cylinders to poor households fired up consumption by 21 per cent during April 1 to 15.
The government has brought back the windfall profit tax on domestically produced crude oil after international prices firmed up while the levy on export of diesel has been cut to nil, according to an official order. The levy on crude oil produced by companies such as Oil and Natural Gas Corporation (ONGC) is now Rs 6,400 per tonne with effect from Wednesday, the order dated April 18 said. At the last revision on April 4, windfall tax on domestically produced crude oil was cut to nil as international oil prices dipped below $75 per barrel.
'If an airline is willing to get the funding, it will fly in unviable routes.'
Govt says domestic carriers' financial health a concern.
Rising fuel prices, intense competition and inability to pass on spiralling expenses have been negatively impacting the domestic airlines.
The government has not taken any decision to privatise Air India, however, it was close to finalising a short-term strategy to strengthen the burgeoning civil aviation sector, including slashing taxes on jet fuel.
The three state-owned oil companies have decided to defer snapping fuel supplies to Air India. The airline owes the three firms over Rs 5,000 crore in past fuel bills.
Indian airline industry is expecting to prune its net losses to Rs 3,000-5,000 crore in this fiscal from an estimated Rs 17,000-17,500 crore in FY2023 on the back of improved yields and stable cost environment, credit ratings agency ICRA said on Tuesday. At the same time, ICRA also estimated that domestic air passenger traffic will expand by 8-13 per cent each in FY2024 and FY2025. The rating agency has also maintained its stable outlook on the industry in view of healthy passenger traffic growth, improved yields and a stable cost environment.
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