Cabinet Clears ₹10,000 Cr ATF Fund To Shield Airlines From Fuel Shock

The Government has announced a new ATF Price Stabilisation Fund aimed at protecting India's aviation sector from the sharp rise in Aviation Turbine Fuel (ATF) prices triggered by the ongoing West Asia crisis. With ATF prices surging from around ₹60 per litre in March to ₹142 per litre by May 2026, authorities had already capped fuel prices for domestic airlines to prevent a spike in airfares for passengers. However, the prolonged crisis placed significant financial pressure on oil marketing companies. The newly announced revolving fund seeks to balance the interests of airlines, fuel suppliers and consumers by providing price stability during the crisis and introducing a structured reimbursement mechanism once conditions normalise. The government believes the scheme will help safeguard more than 7 million jobs linked to the aviation ecosystem, support airport and connectivity growth, and ease some of the operational challenges faced by Indian carriers due to the closure of Pakistani airspace. Watch for a detailed breakdown of what this means for airlines, passengers and the future of India's aviation industry.