Air India plans direct import of jet fuel

Air India will be the second domestic carrier after Kingfisher Airlines to benefit from the government's decision to allow direct import of aircraft turbine fuel (ATF) by airlines, with the cash-strapped national carrier announcing plans to start direct import of the jet fuel in an effort to reduce operating costs.

Air India will soon approach the Director-General of Foreign Trade (DGFT) for permission to directly import aviation fuel, sources close to the development said.

The move follows a government notification issued on Wednesday allowing Indian scheduled airlines to directly import ATF instead of buying it locally.

Airlines wanting to import ATF would have to apply to the Directorate General of Foreign Trade (DGFT) for an import licence, an official press release said on Wednesday.

The group of ministers (GOM) on civil aviation, headed by finance minister Pranab Mukherjee, had considered the matter at its meeting on 7 February 2012 and decided that the ministry of commerce may permit direct import of ATF by or on behalf of Indian carriers as actual users and on actual use basis.

Import of ATF bearing ITC (HS) Code 2710 19 20 has been under state trading regime and only certain state trading enterprises of the Government of India were permitted to import ATF.