Indian Airlines hikes fares citing mounting fuel costs

Thursday, 20 March 2003, 08:00 Hrs
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NEW DELHI: Domestic travel becomes costlier with state-run carrier Indian Airlines (IA) Thursday announcing an across-the-board 15 percent fare hike for all flights.

The civil aviation ministry denied that the hike was related to the war against Iraq but said it was in accordance with the rise in prices of Aviation Turbine Fuel (ATF) that had raised the airline's operational costs.

The whopping fare rise would be operational on all sectors with immediate effect, an Indian Airlines official told IANS.

"This fare hike was budgeted for this year and we were only awaiting a nod from the ministry," the official said.

According to Civil Aviation Minister Syed Shahnawaz Hussain, the ATF price hike had led to huge operational costs for both IA and Air-India (A-I).

Since December, the cost of aviation turbine fuel had increased by 44 percent from $1.01 to $1.44 per gallon.

He did not rule out a hike in A-I fares, but said the decision would be taken only with the nod of the International Air Transport Association (IATA), an umbrella of 150 international airlines worldwide.

The IATA is expected to take a decision in a day or two on increasing the fares by five percent.

"We hope the IATA's decision can enable us to increase our fares by 8 to 10 percent so that we can offset our war and fuel surcharge."

Air India's fuel bill had increased from 100 million in January to 110 million in February and estimated to be 300 million in March.
Source: IANS
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