Indian Airlines ups fares by 10%

State-owned Indian Airlines and Alliance Airways announced a 10 per cent hike in fares with effect from June 21 due to a continuous rise in the prices of aviation turbine fuel (ATF).

The increased fares will be effective on all tickets issued on or after June 21 but shall not affect the confirmed tickets issued on or before the cut-off date.

The increase was necessitated due to a spurt in global crude prices that has led to the fuel cost of Indian Airlines' and its subsidiary Alliance Air's exceeding the budgeted estimate for 2004-05 fiscal by Rs 200 crore. The fare hike is expected to offset some of the losses that the two companies suffer.

The ATF price has shot up from Rs 21,530 per kilolitre in March this year to Rs 26,000 per kilolitre this month. In February this year, the price stood at Rs 23,130 per kilolitre and zoomed to an all-time high of Rs 26,000 per kilolitre in June.

"This has constrained Indian Airlines and its subsidiary, Alliance Air, to increase the domestic fare by 10 per cent. This will also proportionately increase the excess baggage rates which are charged at 1.1 per cent of the economy class," an Indian Airlines executive said.