Priority to bring down airfares: Aviation Minister Ram Mohan Naidu

Telugu Desam Party MP Ram Mohan Naidu, who took charge as the Civil Aviation Minister on Thursday, said that his priority would be to bring down the airfares and make air travel more accessible for common man.

“The prominent issue that the people have been informing me about since the time I have been announced as the Civil Aviation Minister is the issue of high airfares. Wherever I go, people have been telling me about the high airfares, especially after COVID-19,” he told reporters after taking charge. 

Airfares in India are not regulated by the government.

“I need a thorough understanding of this issue so I am going to sit with the stakeholders. I am going to hold review meetings. My priority definitely would be to bring down the airfares because that is a challenge for the common man,” he noted.

Naidu also said that his target is to make India the biggest domestic civil aviation market in the whole world.

“To achieve that target, the airfares have to be affordable... Our intention is to take the air travel to the common man,” he added.

India deregulated its domestic airfare market in March 1994 when the Air Corporations Act was repealed. This move allowed airlines to operate freely without government control over fares, leading to increased competition and lower prices for passengers.

Since then, the government has not intervened to bring it down, even when there have been strong demands to do so, especially during the festival season when spot airfares tend to be higher.

It was only during the peak of the COVID-19 pandemic that the government had restricted the number of flights across India. It had also imposed an upper and lower price caps on domestic airfares, based on the distance of the flights, for about two years till August 2022.

The upper price cap was imposed to protect passengers from high airfares, and the lower price cap was introduced to prevent financially stronger airlines from undercutting weaker airlines by selling tickets at unsustainably low prices.

Since the removal of pandemic-induced restrictions on ticket prices and the number of flights, the Modi government has consistently maintained that airfares will not be regulated.

In December 2023, then Civil Aviation Minister Jyotiraditya Scindia had told Lok Sabha, “As per prevailing regulations, airfare is neither established nor regulated by the government...Globally, most countries have deregulated their aviation sector, i.e., removing government-imposed entry and price restrictions on airlines.” 

“Deregulation has led to increased competition between airline carriers, leading to decrease in airfare. As a result of deregulation, entry into the airlines industry for a potential new airline has become easier, resulting in many new airlines entering the market, thus increasing competition. The direct impact of deregulation is that a passenger in a lower-income group can afford to travel by air,” Scindia had said.

Naidu on Thursday said that he would encourage airlines to increase their flight network from tier 2 and tier 3 cities across the country.

“Infrastructure at smaller airports in India will be my special focus,” he noted. He said he wants to expand the Digiyatra facility, which allows quicker check-in service at certain major airports using biometric details, to all the airports in India.

Naidu said he has a commitment to the people of Andhra Pradesh and Telangana. He said the Bhogapuram airport, which is being constructed about 40 km north-east of Visakhapatnam, will be finished by December next year.