Lok Sabha Question No. 2931 (UNSTARRED), answered on 2024-12-12
Subject: Mechanism to regulate Airfare
Ministry: CIVIL AVIATION
Asked by: Adv. Chandra Shekhar

## GOVERNMENT OF INDIA

## MINISTRY OF CIVIL AVIATION Lok Sabha

UNSTARRED QUESTION NO. : 2931

( TO BE ANSWERED ON THE  12th December 2024 )

## MECHANISM TO REGULATE AIRFARE

2931.    ADV. CHANDRA SHEKHAR Will the Minister of CIVIL AVIATION

be pleased to state:-

- (a) the specific policy initiatives that the Government considers to implement a price control mechanism for regulating airfares;
- (b)  the  action  taken  by  the  Government  in  light  of  the  recent recommendations  from  the  Parliamentary  Standing  Committee  on Transport, Tourism and Culture for route-specific fare capping and the  establishment  of  a  quasi-judicial  entity  to  oversee  airfare regulation; and
- (c)  the  manner  in  which  the  Government  proposes  to  address concerns regarding excessive fare hikes during peak travel seasons ensuring fair pricing for the passengers?

## ANSWER

Minister of State in the Ministry of CIVIL  AVIATION (Shri Murlidhar Mohol)

- (a) to (c): The airfares have moderated in 2024, relative to 2023. The airlines  have  also  been  sensitized  to  ensure  reasonability  while fixing the airfares and to keep passengers' interest in mind. Notably, during  festival  seasons,  a  decrease  in  airfares  was  observed  in various sectors.;

;

The airlines are mandated to display the Tariff Sheet at a prominent location on the home page of airlines' website.; ;

Directorate  General  of  Civil  Aviation  (DGCA)  has  setup  a  Tariff Monitoring  Unit  (TMU)  that  monitors  airfares  on  select  domestic sectors  on  random  basis  by  using  airlines'  websites  on  monthly basis to ensure that the airlines do not charge airfares outside the range declared by them.; ; The  airfares  are  dynamic  in  nature  and  follow  the  principle  of demand  &  supply.  The  trends  in  airfare  prices  in  India  exhibit considerable seasonality, prevailing fuel price, the capacity of the aircraft operating on the route, competition on the sector, season, holidays,  festivals,  long  weekends,  events  (sports,  fairs,  contests) etc.Besides this, the pricing of airfares is significantly influenced by operational constraints at airports. Routes experiencing high tourist demand,  are  subject  to  limitations  imposed  by  terrain,  weather conditions,  and  restricted  operating  hours.  The  combination  of constrained capacity and elevated demand leads to fluctuations in airfares.; ; Airfares  are  not  subject  to  regulation  by  the  Government  and airlines have the flexibility to determine their airfares based on their operational needs, while adhering to Rule 135 of the Aircraft Rules, 1937.  While  the  government  generally  refrains  from  regulating airfares  to  maintain  market  competitiveness,  however,  it  remains vigilant, and the Government intervenes to shift capacity from one sector to another to prevent exorbitant pricing to ensure passenger comfort and welfare.; ; DGCA with quasi-judicial powers has been entrusted with the task of monitoring airfares charged by the airlines. Further, Anticompetitive practices are kept in check by the Competition Commission  of  India  (CCI).  As  such,  there  is  no  requirement  for another separate body to monitor airfares ; Given the complex  dynamics  of  the Indian aviation industry, Government is  playing  the  role  of  a  facilitator  by  way  of  creating enabling environment to support the growth of the sector.

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