Civil Aviation Minister Ram Mohan Naidu Kinjarapu on Friday said that while the government has the exclusive power to cap airfares, it can do so in extraordinary circumstances and not as a long-term solution.
The government uses its powers to cap airfares when it feels that the prices have risen above normal level, the minister told Parliament.
Airfares usually rise during the festive season because of increased demand on specific routes, he said.
“It is not that I can cap the fare for the entire season, entire year for a certain sector because...market demand and market supply is very very important for us to understand,” the minister said. “They kind of play in such a way that they regulate the fares on its own.”
The minister added: “When you are saying deregulation, you are letting the market dynamics flow in. You’re letting the market supply and demand play its own role so that the passenger gets the ultimate benefit.”
On December 6, the civil aviation ministry imposed distance-based fare caps, going up to Rs 18,000 on the longest routes, amid continued disruptions in IndiGo’s operations and a sharp spike in ticket prices. The ceiling on airfares was to apply only to economy-class tickets.
Air travel has been severely affected since December 2, when a shortage of pilots and...
