I have been driving the Palio 1.6 GTX for close to two years now; and I have consistently gotten 11.5 - 12 kms/ltr, but for a few times. I do Pune - bombay regularly and check mileage Pune-bbay-pune which means a part city part highway, AC used while in city limits. I think its pretty good for a 1.6 litre engine, I am pretty satisfied.
The key to this probably is not to rev up the engine too much, and change gears at the right time. But not only that, I also did a running-in for my car, 65 kms/hr limit for the first 900 kms and then 80 kms/hr until 1500. Soon as I did 1500, I opened the engine to 150 km/the on the expressway, mind you ... its a beauty.
