The Indian government has called upon airlines to exercise restraint and maintain a fair balance in the pricing of air tickets, particularly in light of the recent surge in airfares on certain routes following the suspension of Go First flights. While emphasizing that there are no plans to regulate airfares, a senior official expressed the need to minimize the disparity between ticket prices in different fare brackets. India, known for its rapidly growing civil aviation market, has witnessed a recovery in domestic passenger traffic after being significantly affected by the COVID-19 pandemic.
The grounding of Go First flights since May 3 has led to a significant increase in airfares on specific routes previously served by the budget carrier, including Delhi-Srinagar and Delhi-Pune. This reduction in capacity comes at a crucial time when the peak domestic air travel season is approaching. The senior official from the civil aviation ministry emphasized that airlines have been advised to exhibit moderation and maintain a balanced approach when pricing tickets.
The official stressed the importance of avoiding substantial gaps between the lowest and highest fare brackets, ensuring that passengers do not face excessive and burdensome fares. Although there are no plans to regulate airfares, the official acknowledged the challenges caused by the current situation.
Go First, currently undergoing voluntary insolvency resolution proceedings, has suspended flights until May 26. Additionally, IndiGo has grounded several aircraft due to Pratt & Whitney engine issues, and SpiceJet is also facing financial difficulties.
Considering the issue of capacity constraints, the official expressed hope that the resumption of Go First flights would help alleviate the situation before the peak travel season in June.
According to the latest official data, domestic airlines flew 128.88 lakh passengers in April. Notably, there has been a sharp increase in airfares on routes previously operated by Go First. For example, the average one-way spot fare on the Delhi-Leh route witnessed a 125% rise to an average of Rs 13,674 during the May 3-10 period, compared to the April 20-28 period, as reported by travel portal Ixigo. Similarly, the average one-way spot fare on the Delhi-Srinagar route increased by 86% to Rs 16,898 during the same comparable periods.
Following the deregulation of India’s airline sector, airfares are determined by market forces and are not established or regulated by the government. Airlines use multiple fare brackets or Reservation Booking Designators to determine pricing levels.
In a statement to the Lok Sabha on March 16, Civil Aviation Minister Jyotiraditya Scindia clarified that “airfares are neither established nor regulated by the government.” He further explained that the airline pricing system operates with multiple fare brackets, taking into account market dynamics, demand, seasonality, and other market factors. As demand for seat increases, airfares rise, particularly as lower fare brackets fill up quickly during the booking process, aligning with global practices.
