New Delhi, India: The Directorate General of Civil Aviation (DGCA) on Wednesday (Aug 10) announced to remove the ongoing fare caps on domestic airlines from August 31 that had been placed on airline businesses for the last 27 months.
In a notification issued DGCA said, “After review of the current status of Scheduled Domestic Operations viz-a-viz passenger demand for air travel in terms of the purpose specified in the initial Order No. 02/2020 dated 21.05.2020, it has been decided to remove the fare bands notified from time to time regarding airfares with effect from 31.08.2022.”
“The decision to remove airfare caps has been taken after a careful analysis of daily demand and prices of air turbine fuel. Stabilisation has set in and we are certain that the sector is poised for growth in domestic traffic in the near future,” tweeted civil aviation minister Jyotiraditya Scindia.
The government had in 2020 regulated airfares by imposing a minimum and maximum band based on the flight duration to prevent ticket prices from spiking due to high demand arising from an easing of restrictions on air travel. Though the airlines had been reporting losses steadily, they were at least getting the volume of traffic.