Cant cap airfares for entire year: Aviation minister tells Parliament amid Indigo crisis

PTC News Desk: Aviation Minister Ram Mohan Naidu said that it would be not feasible for the government to cap airfares for the whole years especially when the prices are likely to get typically high during festival times. 

"Airfares usually rise during the festive season because of increased demand on specific routes and at particular times. These fluctuations are seasonal, and it is not feasible to cap fares for an entire year on any given sector. Market demand and supply naturally regulate airfares on their own," the minister said.

According to the minister, "the idea behind deregulation when it was introduced was to allow the sector to grow" and "All countries that have seen exceptional growth had deregulated markets. It encourages more players to enter and opens up greater cooperation. You allow market dynamics to function, letting demand and supply play their natural roles. Ultimately, the passenger benefits the most".

The minister spoke in Parliament in response to a private member's link seeking regulation of airfare amid aviation crisis that resulted in skyrocketing of the prices. He firther stressed that deregulation remains the core idea of the aviation sector which enables more players to enter the market. 

However, Naidu clarified that it is not a free hand for the companies, as the Centre retains sufficient powers to intervene when necessary.

"Even though the market is deregulated, the Aircraft Act in its current form gives the central government the authority, in extraordinary circumstances where there is a possibility of misuse, to intervene and set things right. This includes capping fares to ensure that passengers are not subjected to opportunistic pricing," he explained.

The Aviation Minister said that in situations like the Covid pandemic, the Maha Kumbh, and the Pahalgam terror attack—when air travel demand suddenly shot up—the government used its special powers to step in. The recent IndiGo crisis is another example of such intervention.

He also referred to another case of fare control: the ‘Fare Se Fursat’ scheme, created with the Alliance of Airlines. Under this programme, the government has fixed ticket prices on 25 routes, including several in the Northeast and South India.

The minister stressed that regulating airfares is not a simple or one-sided solution. The government has to think about the long-term health of the entire aviation system—airlines, airports, and the network that keeps everything running—before making any decision.