Indian Aviation Minister Naidu Explains Why Year-Round Airfare Caps Are Impractical
Key Points
- 1Indian Civil Aviation Minister K Rammohan Naidu stated year-round airfare caps are impractical due to seasonal demand shifts and airline operational challenges.
- 2The Indian government imposed temporary airfare caps, effective until IndiGo's operational stability is restored, following significant disruptions.
- 3Temporary caps range from Rs 7,500 for routes up to 500 km to Rs 18,000 for routes over 1,500 km, excluding business class and UDAN flights.
- 4The ministry also increased flight availability and routes to provide passengers with more options during peak demand periods.
Indian Civil Aviation Minister K Rammohan Naidu informed the Lok Sabha that the government cannot impose year-round airfare caps. He cited fluctuating seasonal demand and the inherent operational challenges faced by airlines as primary reasons, emphasizing that airfares naturally increase during peak travel periods. This statement comes amidst public concern over surging ticket prices, particularly during festivals, and recent operational disruptions at IndiGo, India's largest carrier, which led to a scaled-back schedule.
Minister Naidu highlighted India's "open sky" policy, designed to foster competition within the aviation sector. However, he confirmed that the Indian Civil Aviation Ministry does intervene when necessary. During the recent IndiGo crisis, which caused significant cancellations and capacity constraints, the ministry stepped in. It issued an order imposing temporary airfare caps, categorized by distance, to prevent exponential price increases.
Under these temporary regulations, airlines cannot charge more than Rs 7,500 for routes up to 500 km, Rs 12,000 for 500–1,000 km, Rs 15,000 for 1,000–1,500 km, and Rs 18,000 for routes exceeding 1,500 km. These fare limits, which exclude User Development Fee (UDF), Passenger Service Fee (PSF), and taxes, do not apply to business class or UDAN flights. The caps will remain in force until IndiGo's operations return to normal, ensuring market stability. Additionally, the ministry has increased available routes and boosted flight frequencies to offer passengers more travel options during high-demand periods.
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