The Ministry of Civil Aviation (MoCA) on Monday urged airlines to ensure checks on any abnormal surge in airfares, particularly during calamities, considering the recent train accident.
During the hour-long meeting with the Airlines Advisory Group, Civil Aviation Minister Jyotiraditya Scindia expressed concerns about the airfare surge on certain routes.
The ministry stressed the need for airlines to self-monitor airfares, especially on specific routes that have experienced a notable price hike, particularly those previously serviced by Go First. With Go First ceasing operations from May 3, the reduction in capacity due to the crisis coincides with the upcoming peak domestic air travel period.
Airlines have been requested to establish a mechanism for ensuring reasonable pricing within the high Reservation Booking Designators, which will be monitored by the Directorate General of Civil Aviation (DGCA), according to a statement from the ministry. Airfares are deregulated under the current framework.
The Ministry also stated that airlines should exercise strict control over ticket prices “in view of the humanitarian situation” during any calamity and monitor and regulate any surges in ticket prices to and from the affected region.
In light of the tragic incident in Odisha, airlines have been advised to provide free carriage (cargo) services to the families of the deceased, the ministry added.
Since the deregulation of India’s airline sector, airfares have been market-driven and are neither established nor regulated by the government. Airline pricing operates on multiple levels known as Reservation Booking Designators (RBDs). In a statement to the Lok Sabha on March 16, Scindia highlighted that “airfares are neither established nor regulated by the government.”
“The airline pricing system operates on multiple levels (buckets) in line with global practices. Prices are determined by airlines based on market demand, seasonality, and other market forces. Airfares increase as demand for seats rises and lower fare buckets get sold out quickly when airlines offer bookings,” he stated in a written reply. India is one of the fastest-growing civil aviation markets globally, and domestic passenger traffic has been recovering after being significantly affected by the COVID-19 pandemic. According to the latest official data, domestic airlines flew 128.88 lakh passengers in April. Crisis-hit Go First is currently undergoing a voluntary insolvency resolution process.