The government doesn’t want to regulate fares but wants airlines to be transparent in their pricing of fares, said Nasim Zaidi, the newly-designate civil aviation secretary.
The government has asked airlines to notify a price band (minimum and maximum fares) for each sector they fly on their website within a week, said Zaidi clarifying on what minister Praful Patel had said in the morning at an aviation meet in New Delhi.
“The government doesn’t want to regulate airfares but just wants airlines to be more transparent,” said Zaidi, who is also the director general at the Directorate General of Civil Aviation (DGCA), the industry regulator.
The civil aviation ministry had summoned CEOs of all the airlines this week after they were found charging exorbitant fares on prime sectors like Delhi-Mumbai. One-way economy class spot fares on some of the full-service carriers had touched Rs 20,000. Earlier in the day, Patel said that airlines will have to notify a price band for every sector. “It has to be in the public domain on each airline’s website on what would be the fares on higher price band,” Patel told reporters here on the sidelines of an aviation conference. He said the DGCA had taken serious note of ‘exorbitant prices’ charged by the airlines on most routes and had issued notices to them. “This kind of predatory pricing can not be justified, it is unfair to the passengers.” Last week, the DGCA had issued a circular, asking the airlines to “furnish a copy of the route-wise tariff across its network in various fare categories, in the manner it is offered in the market, to DGCA on the first day of every calendar month”.
According to the circular, any “significant and noticeable change” in the established tariff already filed (by an airline), should be reported to the DGCA “within 24 hours of effecting such changes”. The regulator had also asked airlines to publish air fares on their websites or in daily newspapers on a regular basis.
“We shall certainly try our best to bring discipline in the aviation sector. Airlines in the last few weeks have been charging very exorbitant prices on some routes,” said Patel. “The regulator has special powers and they can certainly invoke them if airlines don’t act responsibly in days to come”.
Stocks of Jet Airways (India) Ltd, the nation’s biggest domestic airline, and competitors fell on the Bombay Stock Exchange on the minister’s remarks. Jet closed 2.81 per cent down to Rs 861.20 and Kingfisher Airlines fell 1.61 per cent even as the stock market’s benchmark index closed 0.73 per cent.
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