Govt May Rework Rs 10,000 Crore ATF Price Stabilisation Fund As Airlines Show No Interest: Sources
A workable fuel support mechanism could moderate cost and cash flow pressures across airlines and oil marketing companies during the West Asia crisis.
6 Oct 2026 · NDTV Profit
The Union Cabinet approved the fund in June to support airlines and oil marketing companies (OMCs) during the ongoing West Asia crisis.
The analysis
The government may revise the structure of the Rs 10,000 crore aviation turbine fuel price stabilisation fund after airlines showed no interest, according to sources. The Union Cabinet approved the mechanism in June to support carriers and oil marketing companies during the continuing West Asia crisis. The available information does not specify the original terms, why airlines declined to participate, what changes are being considered, or when a revised framework could be presented. It also remains unclear whether the fund has disbursed any money since receiving approval.
The proposed reworking matters because aviation turbine fuel costs can affect airline expenses, fares, capacity decisions and cash flows, while the payment structure may influence oil marketing companies and their working capital. Listed airlines and state owned oil marketing companies therefore have direct exposure, although the effect cannot be assessed without revised eligibility, pricing and disbursement terms. An official framework followed by airline participation and actual fund use would support the view that the mechanism can cushion crisis related fuel volatility. Continued lack of carrier interest, no formal change, or limited disbursement would weaken that reading.