During a discussion in the Rajya Sabha on rising airfares in the country, Minister of State for Civil Aviation Murlidhar Mohol stated that the government typically avoids regulating airfares to preserve market competitiveness. However, he emphasised that the government remains vigilant and intervenes when necessary by reallocating capacity between sectors to curb excessive pricing.
He added that this year, the airfares have moderated, relative to last year.
“With the enhancement of capacity by induction of more aircraft fleet, modernisation of airports and development of new airports, domestic passenger traffic has increased to 153,674,310 in 2023-24 as compared to 136,028,656 in the year 2022-23,” he said in a written reply.
“Even in the current financial year 2024-25, as of October, domestic passenger traffic has reached 93,002,510, surpassing the corresponding figure of 87,995,187 for the fiscal year 2023-24, thereby reflecting an impressive growth rate of 5.7 per cent,” he added.
Responding to queries from CPI-M member John Brittas from Kerala, the minister highlighted the complex dynamics of the Indian aviation industry, stating that the government acts as a facilitator by creating an enabling environment to support the sector’s growth. He further explained that airfares are not regulated by the government, allowing airlines the flexibility to determine fares based on their operational requirements, while ensuring compliance with Rule 135 of the Aircraft Rules, 1937.
He stated that airlines have been advised to ensure fair pricing while setting airfares, keeping passengers’ interests in mind. Notably, a decrease in airfares was observed across various sectors during festival seasons.
The Directorate General of Civil Aviation (DGCA) has established a Tariff Monitoring Unit (TMU) to monitor predatory or excessive pricing by airlines.
The minister further explained that airline ticket prices are driven by the demand-supply mechanism and are regulated under competition laws, specifically the Competition Act, 2002. Anti-competitive practices are monitored and addressed by the Competition Commission of India (CCI).
(With PTI inputs)
