Government prepares draft sustainable aviation fuels policy; moots mandatory blending in ATF from 2027
The civil aviation ministry has circulated the draft National Policy on Sustainable Aviation Fuels which mandates use of only indigenously manufactured SAF to be blended with Aviation Turbine Fuel (ATF).
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Context
The has circulated the draft National Policy on Sustainable Aviation Fuels (SAF), proposing mandatory blending of indigenous SAF with Aviation Turbine Fuel (ATF) starting at 1% in 2027 and scaling to 20% by 2040 (as per the proposed roadmap, though some reports mention 40% as an indicative range for phase 2). The policy outlines fiscal incentives, an innovation fund, and measures to prevent 'economic tankering' by mandating airlines to source 90% of their fuel for international flights from Indian airports.
UPSC Perspectives
Environmental
Sustainable Aviation Fuel (SAF) is a crucial component of the global aviation sector's strategy to achieve net-zero carbon emissions by 2070. The draft policy aligns with India's international commitments, such as the climate pledges made at , by targeting emission reductions in a hard-to-abate sector. By utilizing feedstocks like agricultural residues, used cooking oil, and municipal solid waste, the policy promotes a circular economy while addressing domestic waste management and stubble burning issues. The establishment of a 'SAF Registry' under the is vital for ensuring accountability and interoperability with carbon markets, facilitating tracking of emission reductions.
Economic
The draft policy aims to stimulate a domestic SAF manufacturing ecosystem, leveraging India's vast agricultural resources. This presents a significant opportunity for import substitution and reducing the nation's reliance on crude oil imports for aviation. The The Deloitte India report 'Green Wings' estimates an investment requirement of USD 70-85 billion to achieve 8-10 million tonnes of annual SAF production by 2040. underscores the potential for job creation and industrial growth. The proposed fiscal support, including exemption, viability gap funding (VGF), and green financing, are standard economic tools used to incentivize emerging industries with high initial capital costs and lower current profitability compared to conventional fuels. The mandate that only indigenously manufactured SAF be used strongly supports the Make in India initiative.
Governance
The policy demonstrates a structured regulatory approach through phased implementation, allowing the industry time to build capacity. The proposal to establish a reflects the need for an apex, inter-ministerial body to ensure coordinated implementation across various sectors, including agriculture, petroleum, and civil aviation. The policy's focus on preventing 'economic tankering'—where airlines uplift more fuel at cheaper departure airports—by mandating 90% fuel sourcing from Indian international airports is a strategic regulatory measure. This ensures compliance with blending mandates and supports domestic SAF producers, although it may face resistance from airlines concerned about operational flexibility and fuel costs.