Economy · GS3
Aviation fuel price-stabilisation support
One line
The Cabinet approved ₹10,000 crore in aviation-fuel price-stabilisation support to cushion exceptional fuel-cost pressure on aviation.
Summary
Aviation turbine fuel is a major airline cost. Temporary support raises wider questions about price shocks, competition, fiscal risk, and whether relief preserves connectivity or protects inefficient firms.
PYQ pattern
UPSC often turns this issue into statement-based questions on institutions, mechanisms, and policy limits. Use the official UPSC question-paper archive.
Core notes
- Aviation turbine fuel is used by turbine-powered aircraft and is linked to global energy prices and exchange-rate movements.
- A price-stabilisation measure should state eligibility, duration, risk sharing, and an exit rule.
- Support can protect routes and capacity during a shock, but weak design can create moral hazard.
- The policy should be judged by additional connectivity and service continuity, not only by money disbursed.
Prelims lens
- Aviation turbine fuel and motor petrol are different petroleum products.
- A Cabinet approval is a policy decision; implementation depends on notified terms.
- Price stabilisation is distinct from permanently fixing every airline fare.
MCQ 1
Consider the following statements:
- Aviation turbine fuel and motor petrol are different petroleum products.
- Price-stabilisation support permanently fixes all passenger airfares.
Which of the statements given above is/are correct?
- A. 1 only
- B. 2 only
- C. Both 1 and 2
- D. Neither 1 nor 2
Reveal answerHide answer
A
Statement 1 is correct. Statement 2 is incorrect: price-stabilisation support permanently fixes all passenger airfares is not a valid conclusion.
MCQ 2
Which factor directly affects the rupee cost of imported aviation fuel?
- A. The exchange rate
- B. The delimitation of constituencies
- C. The monsoon onset date alone
- D. The Finance Commission award alone
Reveal answerHide answer
A
Oil prices are commonly denominated internationally, so exchange-rate movements affect domestic input cost.
Mains
Question, 10 marks, 150 words: When is temporary price-stabilisation support justified, and what safeguards should accompany it?
Approach:
- Explain the external fuel-price shock.
- Assess connectivity and competition benefits.
- Discuss moral hazard and fiscal exposure.
- Propose time limits, transparent eligibility, and outcome reporting.