In India, private airlines have a tough field. They have to pay high rates for their fuel (ATF costs in India are higher than most places in the world), the conversion to new airports run by private operators are loading user convenience charges that passengers do not like to pay, and it is a cut-throat business with high fixed charges and a variable market that has been severely affected by the economic slow-down.
So, most private airlines are in the red, owing money to fuel companies, to airports, to their debtors, and they do not see a solution in sight. The Government in the past has not provided them any solution in the form of lower taxes on ATF, or any kind of monetary hand-out.
Eventually, the Federation of Indian Airlines, comprising of 5 of the private airlines called for something unprecedented, a one day strike on August 18th where they would stop all operations, and refund all tickets. This was primarily meant as a pressure tactic, and they must have got bold after seeing Anil Ambani take on the Government and not suffer any apparent problems. However, the Government response was swift and harsh. The Government threatened to take strict action, including reviewing their licenses.
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Mukesh Ambani would never have thought that finding a massive gas would continue to cause him so much problems; maybe, to make huge amounts of money, you need to have massive problems at the same time. A few years back, Reliance had participated in the Oil exploration scheme of the Government, and got allotted some of the deep sea blocks of the Krishna-Godavari basin fields, and in some time, struck a massive gas field. This promised untold riches to the company, and to the Government of India, since the Government of India owned the gas field and Reliance was the operator. As per the agreement, the Government controls who can get the gas, and at what price; and since the Government gets a cut of the price, the Government has a key stake in the price.
The Ambani brothers got into a huge dispute, which was eventually resolved after a settlement involving the division of the family controlled business. As a part of this agreement, the more complex agreement involved the provision of gas from the RIL to the Anil Ambani controlled RNRL at $2.34 mmBtu for 17 years from the setting up of the Dadri power plant. This price was based on the then decided price (the same price at which the gas was to be then provided to the Government run power utility). This was an agreement between the 2 brothers and their controlled entities, and did not seek any approval of the Government, which after all, owns the gas.
You must have seen this all the time. You go to a fuel pump, and they ask you whether you want the premium fuel (whether it is petrol or diesel); in some cases, they will tell you that the premium fuel is better for your engine, as well as for the mileage of your vehicle. The fuel will have the name of ‘Premium’, ‘Turbo’, or ‘Speed’, all designed to make sure that you feel that you are taking a fuel much better than the traditional fuel. The television advertisements are all designed to project the same thing, with the fuel supposed to have additives that smoothen the engine, and deliver many other benefits.
Months back, when fuel prices were very high, the oil companies were actually forcing higher consumption of these branded fuel through greater marketing campaigns, as well as through actual constriction of supply of the non-branded fuel at the fuel pumps. So, what is the reality of these branded fuels ? Do their consistent campaigns have any real substance to them ? Does your vehicle benefit if you use such fuels ? Well, the MRTPC did a study, and found that there was no evidence to backup these claims (link to article):