The cash-strapped airline Kingfisher could get some good news soon. The Government has indicated that it may permit the airline to import jet fuel better known as aviation turbine fuel (ATF), but not as a policy decision but only as an exemption.
According to sources, the Directorate General of Foreign Trade (DGFT) called senior officials of the airline on Monday. It is believed that airline has been asked to furnish some information regarding quantity to be imported and logistic arrangement for import and distributions.
The official said that once DGFT gets all the information, then it will finally examine the proposal in consultation with the Petroleum Ministry. Then a decision can be taken on the request and grant the approval accordingly, the official added.
A senior Government official clarified, “There would not be any policy change and all the airlines will not be automatically granted approval to import. Since only Kingfisher has applied, we may consider only that.” The request will be considered on the basis of Clause 2.5 of the Foreign Trade Policy.
The airline wrote a letter on October 5 requesting the DGFT to allow import of jet fuel for captive requirement.
At present, rules say that ATF can be imported only by state trading enterprises or by those companies who have been granted rights for marketing of fuels by the Petroleum Ministry. In case direct import licence is granted, that can be done only through Indian Oil. In its request letter Kingfisher requested for a change in the policy to allow free import by the airline.
The official said that the rule can be relaxed as a special case under Clause 2.5 of the trade policy. According to the Clause, the DGFT may pass such orders or grant such relaxation or relief, as he may deem fit and proper, on grounds of genuine hardship and adverse impact on trade.
The airline in its letter argued that the domestic pricing of the jet fuel is not controlled and does not enjoy any subsidy. It assured that it will make arrangement with service providers for storage and handling at ports for into service at ‘Open Access' airports such as Delhi, Hyderabad and Bangalore.