Civil Aviation Minister K Rammohan Naidu on Friday said that while the government holds “exclusive powers” to cap airfares in extraordinary situations, fare regulation cannot be viewed as a standalone solution to tackle price spikes. His remarks came during a debate in the Lok Sabha on a private member’s resolution seeking measures to regulate domestic airfares.
Responding to the resolution, introduced by Congress MP Shafi Parambil and later withdrawn, Naidu stressed that India’s aviation sector operates within a complex ecosystem with multiple interlinked components, including airline viability, aircraft availability and global supply dependencies.
Earlier this month, the ministry imposed a temporary distance-based cap on domestic airfares after large-scale IndiGo flight disruptions resulted in unusually high ticket prices. However, Naidu clarified that India’s airfares remain “on par with other nations” and that broad, nationwide caps are neither feasible nor sustainable in a deregulated market.
“A deregulated market ultimately benefits consumers. Ticket prices tend to rise during seasonal demand peaks. If we want the civil aviation sector to grow, the foremost requirement is to keep it deregulated so more players can enter,” Naidu said. However, he emphasised that deregulation does not equate to a “free hand” for airlines and the government can intervene when fares become “abnormal”.
As part of a pilot initiative, state-owned Alliance Air has launched a three-month fixed-fare scheme. Depending on its impact and passenger feedback, the ministry may explore similar frameworks for private carriers.
Naidu also argued that airfares in India have effectively become more affordable over time. “There has been a 43% decrease in airfares when you consider CPI inflation,” he said, though he did not specify the comparative time period.
Aircraft shortage remains key bottleneck
The minister noted that the pressing challenge lies in the non-availability of aircraft. Indian airlines have more than 1,700 aircraft on order but deliveries are delayed due to global supply chain constraints.
To address long-term capacity needs, Naidu outlined the government’s push to manufacture aircraft domestically. He cited ongoing discussions with Russian manufacturer Sukhoi for its SJ-100 regional jet, with HAL involved through an MoU to facilitate technology transfer. Talks are also underway with Brazilian aircraft maker Embraer to set up local manufacturing. “We are telling them to come to India and manufacture here,” he said.
Opposition raises concerns over pricing
Participating in the debate, Congress MP Varsha Gaikwad alleged that air travel has become unaffordable for the common citizen. She cited instances of fares jumping from Rs 5,000-Rs 6,000 to as high as Rs 30,000. She also flagged the dominance of a few airlines following multiple closures and mergers.
Samajwadi Party MP Ramashankar Rajbhar echoed these concerns, warning that concentration of airline operations enables arbitrary fare hikes. This also reduces competition and raises fears of overpricing, Rajbhar said.