SpiceJet will be the first Indian carrier to directly import aviation turbine fuel (ATF) after import rules were liberalized earlier this year. India has some of the highest ATF taxes in the world, and airlines hope to cut their fuel bills by importing fuel.
The airline will bring in ATF from Singapore by sea, before transporting the fuel domestically to airports by truck or rail. With the average tax on ATF at almost 25%, SpiceJet expects to avail of significant savings through this move. SpiceJet hopes to initially cover almost 1/3 of its fuel usage with imported fuel.
High fuel costs have been cited as one of the biggest reasons for the struggles of Indian carriers today.