Civil Aviation Minister Jyotiraditya Scindia said that the decision to remove airfare caps was taken after careful analysis of daily demand and the price of the air turbine fuel (ATF)
Representational image. ANI
New Delhi: Airfare caps on tickets of domestic airlines will be removed from 31 August, 2022, the Ministry of Civil Aviation has said on Wednesday as it lifted restrictions on flight ticket prices.
For the unversed the airfare caps were imposed on domestic airlines in 2020 during the COVID-19 pandemic.
Why airfare caps on domestic airlines has been removed?
Civil Aviation Minister Jyotiraditya Scindia said that the decision to remove airfare caps was taken after careful analysis of daily demand and the price of the air turbine fuel (ATF).
“Stabilisation has set in and we are certain that the sector is poised for growth in domestic traffic in the near future,” the minister added.
Notably, ATF prices have increased record levels due to the Russia-Ukraine war since 24 February this year. A little respite in price is being witnessed over the past few weeks.
“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 August, 2022,” the order by the Ministry of Civil Aviation stated.
In June, the government held discussions with several airlines about removing the price bands for passenger fares where aviation companies said that cap on airfare was becoming a hurdle for the industry to recover fully after the COVID-19 pandemic.
What are airfare caps?
The government imposed cap of airfare when it lifted restrictions on air travel in May 2020, after two months of grounding all planes to curb the spread of COVID-19.
In a rare move, it had regulated fares by imposing a minimum and maximum band based on the flight’s duration to prevent ticket prices from spiking due to pent-up demand arising from restrictions on air travel easing.
With inputs from agencies
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