The Union Cabinet on Tuesday approved a massive ₹10,000 crore ATF Price Stabilisation Fund aimed at supporting Indian airlines facing pressure from sharply rising aviation fuel costs. The decision comes amid growing concerns over the impact of global geopolitical tensions and rising crude oil prices on the aviation industry.
Briefing the media in New Delhi after the Cabinet meeting, Union Information and Broadcasting Minister Ashwini Vaishnaw said the newly approved ATF Price Stabilisation Fund will function as a self-sustaining revolving mechanism designed to stabilise Aviation Turbine Fuel prices for scheduled Indian carriers operating domestic and international services.
The government said the move is expected to provide major relief to airlines while also protecting nearly 77 lakh jobs directly and indirectly connected to India’s aviation ecosystem.
Rising Fuel Prices Trigger Government Intervention
The Cabinet decision comes at a time when global ATF prices have witnessed a sharp increase due to the ongoing crisis in West Asia. According to government data, international ATF prices jumped nearly 2.5 times, rising from around ₹60.5 per litre in March to nearly ₹142 per litre in May this year.
Officials stated that the ATF Price Stabilisation Fund will help reduce sudden financial stress on airlines caused by global fuel price fluctuations. Under the scheme, Oil Marketing Companies will receive a one-time interest-free advance of up to ₹10,000 crore from the government to manage price stabilisation measures for scheduled Indian airlines.
Industry experts believe the decision could help airlines maintain operational stability, prevent fare shocks for passengers and support the overall aviation sector at a time of global uncertainty.
The aviation industry has been under pressure over the last few months due to rising fuel costs, supply chain disruptions and increasing operational expenses. Since ATF contributes a major share of airline operating costs, any sharp increase directly affects airline profitability and ticket pricing.
Cabinet Clears Delhi-NCR Pollution Reduction Scheme
Apart from the aviation relief package, the Union Cabinet also approved a major scheme aimed at reducing air pollution in the Delhi-NCR region. The project will be implemented through the National Capital Region Planning Board in collaboration with Delhi, Haryana, Rajasthan and Uttar Pradesh.
Under the two-year programme, nearly two lakh old trucks and around 16,000 buses will be replaced with cleaner and more environment-friendly vehicles.
Officials said the scheme is expected to significantly improve air quality in the National Capital Region while promoting cleaner mobility and reducing vehicular emissions. The government has been focusing on pollution control measures as Delhi-NCR continues to face severe air quality challenges every year.
New Coastal Highway Project Approved
The Cabinet also approved the construction of a new coastal highway stretching from Rameshwar to Paradeep. The project will cover a total distance of more than 163 kilometres and is expected to improve regional connectivity and logistics infrastructure.
According to the government, the total estimated cost of the coastal highway project is over ₹8,300 crore. The highway is expected to support economic growth, tourism, trade movement and faster transportation across coastal regions.
Infrastructure experts believe the new road corridor could strengthen economic activity in eastern coastal areas while improving connectivity for industries and ports.
Government Focuses on Economic Stability
The latest Cabinet decisions reflect the government’s broader focus on economic stability, infrastructure expansion and employment protection. The approval of the ATF Price Stabilisation Fund is being viewed as one of the biggest support measures announced for the Indian aviation sector in recent years.
Analysts say the move may help airlines manage operational risks more effectively while protecting passengers from sharp fare increases caused by volatile fuel prices.
With aviation demand continuing to rise and infrastructure projects gaining momentum, the government appears focused on balancing economic growth with long-term sustainability and public welfare.
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