Airlines on budget drive as rising fuel price, falling rupee start to pinch

No-frills airlines like IndiGo and SpiceJet, too, have clamped down on salary raise for employees, citing high fuel cost

It is going to get hard to differentiate between a full-service carrier and a budget airline as the aviation industry goes on an economy drive. Threatened by rising fuel price and a falling rupee, airline companies are planning drastic measures ranging from freezing increments to cutting down on flights and in-flight luxuries to save and earn that extra penny.

State-owned Air India, reeling from a Rs 500-billion debt after a failed privatisation attempt, is at the forefront of cutting out the frills. Overtime pay, staff conveyance, travel expenses, and building maintenance costs are among the first casualties at Air India.