Govt to Remove Domestic Airfare Caps From 31 Aug: Here Is All You Need to Know

The ministry had imposed lower and upper limits on domestic airfares when services had resumed on 25 May 2020.

Representational image.

(Photo: PTI)

Limits imposed on domestic airfares will be removed from 31 August, after a span of approximately 27 months, the Union Civil Aviation Ministry said on Wednesday, 10 August.

The Ministry of Civil Aviation said in its order, “After review of the current status of scheduled domestic operations viz-a-viz passenger demand for air travel, it has been decided to remove the fare bands notified from time to time regarding the airfares with effect from 31.08.2022.”

“The airlines/airport operators shall, however, ensure that the guidelines to contain the spread of COVID-19 are strictly adhered to and COVID appropriate behaviour is strictly enforced by them during the travel,” the order added.

What Has the Civil Aviation Minister Said?

Meanwhile, Union Civil Aviation Minister Jyotiraditya Scindia said, “The decision to remove air fare caps has been taken after careful analysis of daily demand and prices of air turbine fuel. Stabilisation has set in and we are certain that the sector is poised for growth in domestic traffic in the near future.”

How Has the ATF Price Changed in the Past Few Months?

ATF prices have been coming down during the last few weeks after jumping to record levels, primarily due to the Russia-Ukraine war that began on 24 February.

On 1 August, the price of ATF in Delhi was Rs 1.21 lakh per kilolitre, which was around 14 percent lower than last month.

What Has Happened So Far?

The ministry had imposed lower and upper limits on domestic airfares based on flight durations when flight services had resumed on 25 May 2020 after a two-month lockdown due to the COVID-19 pandemic.

For example, airlines currently cannot charge a passenger less than Rs 2,900 (excluding GST) and more than Rs 8,800 (excluding GST) for domestic flights of less than 40 minutes.

The lower caps were there to protect the financially weaker airlines and the upper caps to protect passengers from high fares.

Vistara CEO Vinod Kannan had on 19 June said that he would be happy if the lower and upper limits on airfares were increased but the best solution would be for the airlines to have absolute freedom on airfares.

(With inputs from PTI.)