No cap on domestic airfares from August 31: Centre

The decision has come at a time when competition is heating up in the domestic aviation sector amid high demand

BUSINESS DESKUpdated: Wednesday, August 10, 2022, 11:35 PM IST
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Mumbai: Barely a day after Civil Aviation Minister Jyotiraditya Scindia said that the government will re-evaluate the cap on airfare once there is a healthy situation in terms of aviation turbine fuel prices (ATF) movement, the ministry has decided to withdraw the existing fare cap on air tickets. The Centre imposed a cap on fare of domestic airlines during the initial days of the Covid-19 pandemic in 2020. The cap will be removed from August 31, the ministry said.

The decision has come at a time when competition is heating up in the domestic aviation sector amid high demand. “The decision to remove airfare caps has been taken after careful analysis of daily demand and prices of air turbine fuel,” Scindia tweeted. He posted, “Stabilisation has set in and we are certain that the sector is poised for growth in domestic traffic in the near future.”

The upper and lower limits on airfares were introduced in May 2020 to ensure reasonable fares for both passengers and airlines during the pandemic. The flight duration was divided into seven categories – 0-30 minutes, 30-60 minutes, 60-90 minutes, 90-120 minutes, 120-150 minutes, 150-180 minutes, and 180-210 minutes. For instance, the Delhi-Mumbai flight ticket was then priced between Rs 3,500 and Rs 10,000 under the 120-150 minutes category.

The order by the Civil Aviation Ministry has also said that the airlines/operators shall, however, ensure that the guidelines to contain the spread of Covid are strictly adhered to and appropriate behaviour is strictly enforced.

According to industry data, the domestic aviation operations have been witnessing a rise in the last few months with Covid protocols in place. As per the ministry, 632,187 passengers flew domestic flights on Tuesday.

(with inputs from agencies)

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