Ask any traveller and he’ll agree that cheap airline tickets are a good thing. The Union ministry of civil aviation also thinks they’re not a bad thing. Just one bit of trouble: it now wants to turn its perception of what is good into reality. Reports suggest the ministry is working on a plan to “regulate” the lower and upper bands offered by airlines.
This is as close as one can get to price regulation. There may be a number of “good” reasons for fare regulation: for example, saving airlines from “ruinous competition” or preventing passengers from being “fleeced”. None of them hold water.
At any given time, pricing decisions depend on supply and demand of the good in question. Sure, cartelization and other deviant behaviour can’t be ruled out, but preventing that is the job of a regulator and not the ministry. It is best for everyone if the ministry doesn’t get involved in any kind of price regulation.
