Corporate travellers flying in and out of India face immediate cost pressure after IndiGo—India’s largest carrier by market share—announced a fresh hike in its distance-based fuel surcharge. The increase, unveiled on 5 October, will apply to all tickets booked from 00:01 IST on 6 October. Domestic levies will now range from ₹375 to ₹1,300 per sector, while international flights will attract surcharges of ₹1,000–₹3,000 for the SAARC region, ₹5,500 for most of Asia and the Gulf, and up to ₹10,000 for Europe; Africa flights jump to ₹6,000. This is the second adjustment since the surcharge was introduced in March and follows a 14 % month-on-month spike in Aviation Turbine Fuel (ATF) prices, driven partly by supply disruptions in West Asia. ATF typically represents 40 % of an Indian carrier’s operating costs, and analysts estimate the new charges could lift average return fares by 7–10 %. rival airlines such as Air India and Vistara are expected to follow suit within days to protect margins. For mobility budgets the timing is awkward: October marks the start of the festive and business-conference season, when seat demand already pushes prices higher. Travel-management companies (TMCs) are advising clients to lock in Q4 itineraries immediately and to weigh alternative hubs such as Colombo or Dubai if routings permit. Companies with large domestic shuttle requirements may want to revisit travel-policy thresholds and explore rail or videoconference substitutes for sub-500 km trips that now carry the steepest percentage increase. On the policy front, the surcharge has renewed industry calls for the Centre to bring ATF under the national Goods and Services Tax (GST) regime, which proponents say could shave 10–15 % off jet-fuel bills by allowing carriers to claim input-tax credits. The civil-aviation ministry has yet to indicate whether the subject will feature at the upcoming GST Council meeting on 9 October. Until structural tax relief materialises, mobility managers should expect volatility: IndiGo stated it will “continue to recalibrate” surcharges in line with fuel trends—code for further price movements if geopolitical tensions escalate or OPEC supply cuts persist.
Source: Business Standard
