Domestic air fares may soon skyrocket: Here’s why
The Centre had in May last year imposed certain restrictions for air travel during the COVID-19 pandemic to ensure that the flight rates don’t shoot up.
The Minister of State for Civil Aviation Minister Hardeep Singh Puri had divided the air routes into seven slots or bands. The minimum and maximum fares were capped according to the routes.
For example, a DGCA order said the that the lower and the upper fare limits for the first band is Rs 2,000 and Rs 6,000, respectively.
According to the order, the maximum fare across all bands could not exceed Rs 10,000.
Also 40% of seats have to be sold at a fare less than the midpoint of the band. For example, midpoint of Rs 3,500 and Rs 10,000 is Rs 6,700. So 40% of the seats have to be sold at a price less than Rs 6,700. “This is how we’re ensuring that fares don’t go out of control,” the ministry had stated.
Hence, once the fare bands are removed, airlines can resort to their original pricing system. This means that flight tickets across all routes can exceed Rs 10,000, depending upon the demand.
It also means that all the seats can be charged according to the original tariff, which could be higher than the fare moderated by the government.
