PM 'concerned' over predatory pricing by domestic airlines

  • HT Correspondent, Hindustan Times, New Delhi
  • Updated: Aug 27, 2015 23:09 IST

Prime Minister Narendra Modi has expressed concern over predatory pricing by domestic airlines, which is giving a bad name to the industry, minister of state for aviation Mahesh Sharma has said.

"It (predatory pricing) is a concern of a majority of Parliamentarians, including the Prime Minister, and needs to be addressed," Sharma said on Thursday. "The Prime Minister has shown his concern over the predatory pricing issue," he added.

Airlines need to reduce fares and not hike them particularly when it comes to emergency travel like in case of medical emergency, he added.

Meanwhile, in a move that may increase fares, the government is also mulling a 2% cess on air tickets. The money will be used for viability gap funding of domestic carriers operating flights to remote areas, as the government looks at ways to enhance connectivity to places, including the north-east, sources said.

Sharma said the issue of predatory pricing had come up during a presentation by the aviation ministry to the Prime Minister on Tuesday. "We will take airlines into confidence and tell them that the practice is giving a bad name to the industry."

Adding that the 5/20 rule will be reviewed with sea changes, Sharma said: "This will be reviewed with sea changes, and will definitely be reviewed. Something good and better will be there."

The rule bars domestic airlines from flying international routes unless they have completed five years of domestic operation and have a fleet of 20 aircraft.

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