Centre not to cap airfares for this festive season
In Short
Civil Aviation minister advises airlines to keep rates reasonable
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Centre not to cap airfares for this festive season
New Delhi: The Union government is not planning to cap airfares during the upcoming festive season, Civil Aviation Minister K Rammohan Naidu said on Tuesday. However, airlines will be advised to keep ticket prices at a ‘reasonable level,’ he said, noting that higher fuel costs had increased operating expenses of aviation companies.
Naidu made the remarks while speaking to reporters on the sidelines of the signing of agreements for the next phase of UDAN scheme, a regional connectivity programme to make air travel affordable. He said the government has previously engaged with airlines to address airfare concerns during festivals and important events.
“We engage with the airlines continuously; we also have regular meetings with them. And we definitely point it to them that during this festive season, you have to ensure that the fair prices are kept at a reasonable level so that the people who want to travel, especially in these important times, get to see the benefit,” the minister said.
Naidu also attributed the pressure on ticket prices to the ongoing crisis in West Asia, which, he said, has pushed up the cost of aviation turbine fuel (ATF). Fuel constitutes a significant share of an airline’s overall operating expenses. “This is not necessarily because of the festive season or anything, but there is an ongoing crisis situation,” he said.
According to Naidu, ATF accounts for around 40 to 43 per cent of airfares. As a result, even a marginal increase in fuel prices has a direct impact on the cost of air tickets. The government has taken several measures this year to shield airlines from the sharp volatility in jet-fuel prices triggered by the West Asia crisis.
In June, the Union Cabinet approved a Rs 10,000-crore price stabilisation fund to provide support to public sector oil marketing companies and enable them to keep ATF prices for scheduled Indian airlines stable for three years.
