Domestic Airfares Update: The Civil Aviation Ministry had imposed airfare restrictions in December after IndiGo cancelled a large number of flights and other airlines increased fares.
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Domestic Airfares Update: The government has decided to lift the temporary cap on domestic airfares effective March 23rd. The ceiling was imposed in December last year in response to operational difficulties faced by IndiGo. According to an order issued by the Ministry of Civil Aviation, the cap on airfares will be lifted effective March 23rd. This order comes at a time when domestic airlines are grappling with rising costs and disruptions amid the ongoing war in West Asia.
What the Ministry Said in Its Order
The Ministry stated in its order, “Airlines shall ensure that fares remain reasonable, transparent, and in line with market conditions, and do not adversely impact passenger interests.” The Ministry also emphasized that any cases of excessive or unreasonable fare increases and disruptions will be taken seriously. The Ministry is monitoring airfares on a real-time basis.
The cap was imposed amid the IndiGo crisis.
The Ministry of Civil Aviation imposed airfare restrictions in December, after IndiGo canceled a large number of flights, prompting other airlines to increase fares. At that time, the government had fixed ticket prices based on distance, with an upper limit of ₹18,000 for a one-way trip. Although the IndiGo crisis ended after a few days, these fare restrictions remained.
Airlines facing financial pressure
Indian airlines recently warned the government about increasing financial pressure. They stated that these fare restrictions could no longer be sustained amid rising fuel prices and operational disruptions. The Federation of Indian Airlines, representing IndiGo, Air India, and SpiceJet, warned that if these restrictions continued, airlines might be forced to close some of their routes. Furthermore, they might have to delay fleet and network expansion.
Airline Expenses Rise
The industry body stated that airlines were already under pressure even before the conflict in West Asia began. They cited restrictions imposed by Pakistan on its airspace, forcing international flights to take longer routes, increasing both fuel consumption and costs.
The Federation of Indian Airlines stated in its letter, “If the current situation continues, airlines will suffer significant financial losses. This will put many companies in a financial situation that will be unsustainable and could even threaten their very existence.”
