Image Source : AP Aircraft
A parliamentary panel has proposed the implementation of route-specific capping of airfares and the establishment of a distinct regulatory entity to oversee ticket pricing, aiming to address concerns over escalating fares in the aviation sector.
In response to the civil aviation ministry’s feedback on airfares, the committee highlighted the inadequacy of self-regulation by airlines and advocated for a mechanism granting the Directorate General of Civil Aviation (DGCA) authority to regulate air tariffs.
Presently, airfares remain unregulated by the government. The panel reiterated its proposal to explore the creation of an independent entity vested with quasi-judicial powers to monitor airline fares.
Additionally, the committee suggested examining the feasibility of introducing fare ceilings specific to routes while considering both airline and passenger interests. It recommended potential modifications to these ceilings during peak seasons, subject to prior notice.
“It also recommends that, in order to protect the commercial interests of the airlines, the feasibility of modifying the ceiling during the peak or festival season, with prior intimation, be examined,” the report added.
Acknowledging that revenue management and commercial considerations heavily influence airfare determination, the panel underscored the need for the ministry to ensure compliance with Rule 13(1) of the Aircraft Rules, 1937, to curb fare surges.
“Hence, it strongly recommends that the Ministry formulate a mechanism to ensure compliance with Rule 13(1) of the Aircraft Rules, 1937, thereby ensuring control over the surge in airfares. Again, the term ‘reasonable profit’ is used without a clear definition or specific criteria, making it a subjective measure,” it said.
Furthermore, the committee critiqued the lack of clarity surrounding the term “reasonable profit” and emphasised the necessity of formulating precise criteria to gauge profitability. It also questioned the equity of seat price variations within the same flight and urged a review of policies governing such disparities.
Regarding the practice of unbundling airfare components, the committee called for a thorough examination of its impact on consumer costs, cautioning that while it might reduce expenses for some passengers, others could face increased charges for supplementary services.
(With PTI inputs)
