Whalesbook
Regulatory Shift Enables ATF Blending
New Delhi has approved the blending of ethanol and other synthetic or man-made hydrocarbons into aviation turbine fuel (ATF). This significant policy enablement follows amendments to the Aviation Turbine Fuel (Regulation of Marketing) Order, 2001, under the Essential Commodities Act, 1955. The broadened definition of ATF now accommodates blends conforming to IS 17081 standards, facilitating the introduction of newer fuel variants. The stated objectives are clear: to curb emissions and reduce national reliance on imported oil. This strategic move positions India to gradually integrate more sustainable fuel sources into its aviation ecosystem.
The Global SAF Race: India's Cautious Pace
While India permits ATF blending, its approach to domestic flight mandates lags behind leading global economies. The EU has mandated a 6% SAF blend by 2030, with the UK targeting 9.5% by the same year. Japan plans a 10% mandate by 2030, and nations like Norway and France have already implemented significant blending requirements. India has, however, established indicative blending targets for international flights, aiming for 1% Sustainable Aviation Fuel (SAF) by 2027, scaling to 2% in 2028 and 5% by 2030, in line with the International Civil Aviation Organization's (ICAO) Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). CORSIA itself mandates carbon-neutral growth for international aviation from 2027. Crucially, no specific targets have been set for the fuel used in India's rapidly growing domestic flight sector. This creates a bifurcated strategy, potentially leaving domestic aviation's decarbonization efforts dependent on future policy developments rather than immediate regulatory drivers.
Mandate Gap Poses Domestic SAF Challenges
The lack of immediate mandatory blending targets for domestic flights presents a considerable risk. This approach could lead to a slower pace of decarbonization compared to global peers, where mandates strongly encourage SAF production and uptake. India has abundant biomass resources, estimated at around 230 million tonnes of surplus agricultural waste, which could support significant SAF production. However, the absence of domestic mandates may deter the large-scale investment needed. This gap could also create operational complexities and sustainability differences between domestic and international flights operating in India. The ATF market is already volatile; prices having doubled in early April 2026 due to geopolitical events, prompting government intervention to limit increases for domestic carriers. A future mandate, if implemented abruptly, could impose substantial costs on airlines and passengers, particularly without a developed domestic SAF supply chain. The current policy enables blending but relies on voluntary adoption or future regulatory action for significant domestic impact, unlike the binding targets in many mature markets.
India's Broader Sustainability Drive
Despite the current absence of domestic mandates, India is actively pursuing broader sustainability goals. The country aims for net-zero emissions at airports by 2050, with 93 airports already running on 100% green energy. India's involvement in the Global Biofuel Alliance, formed with the US and Brazil in 2023, shows its commitment to sustainable biofuels like SAF. India has significant long-term potential to become a major SAF producer and exporter, thanks to its feedstock availability and growing waste-to-energy capabilities. The government's current focus is on international flight targets and building a sustainable aviation sector, suggesting domestic mandates may be introduced later as global standards develop and domestic production grows.