Panel wants flight ticket prices linked to inflation, rates capped
Members also sought maximum and minimum limits on airfares on all routes
New Delhi: Some members of a Parliamentary panel have suggested that the government should look at linking airfares with inflation instead of dynamic pricing system, and also cap ticket prices, according to sources.
The suggestions were made by some members of the Parliamentary Standing Committee on Transport, Tourism and Culture during a meeting with senior officials of the civil aviation ministry on Wednesday.
There have been concerns about steep fluctuations in air ticket prices during festival seasons and calamities. Against this backdrop, some members of the panel recommended that airfares should be linked to inflation, rather than prices being determined on the basis of demand, a source, who was present at the meeting on Wednesday, said. Few members also suggested that ticket prices could be linked to the aviation turbine fuel (ATF).
Members also sought maximum and minimum limits on airfares on all routes, said the source quoted above. ATF accounts for a substantial chunk of operational expenses incurred by airlines. Rising crude oil prices were adversely affecting the profitability of carriers.
Some members also flagged concerns about the rise in air ticket prices during the Kerala floods, said the source quoted above. Members also sought a new set of guidelines to ensure that airfares remained as low as possible during the time of a crisis or natural calamity. The Directorate General of Civil Aviation (DGCA) had closely monitored airfare movements for flights connecting flood-hit Kerala.
The aviation ministry has said air ticket prices are based on demand and the regulator does not have any role in fixing fares. On one side,the government was aiming to make flying more affordable for the common man and on the other side, ticket prices were rising with demand, the source said, adding, the model of demand-driven air ticket pricing should be done away with.
On 20 August, Civil Aviation Minister Suresh Prabhu said the DGCA was monitoring ticket prices for flights connecting flood-hit Kerala, but it should not be seen by airlines as micro-management by the government since it was an unique situation of “humanitarian crisis”. The Parliamentary panel is headed by Trinamool Congress leader Derek O’ Brien.