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Domestic flight ticket rates set to rise as Centre relaxes cap on price bands
As per the order issued by the civil aviation ministry on Thursday, airlines will be allowed to charge more from passengers as the government has allowed a substantial increase on the upper and lower limits of the price bands.
The ministry of civil aviation on Thursday extended the cap on domestic flights' price bands till March 21 but it allowed the airlines to increase the upper and lower cap on the fares by up to 30%.
The Centre had imposed a cap on domestic airfare after resumption of flights on May 25 last year, following a two month suspension of services imposed due to the lockdown, to curb the spread of Covid 19.
As per the order issued by the civil aviation ministry on Thursday, airlines will be allowed to charge more from passengers as the government has allowed a substantial increase on the upper and lower limits of the price bands.
For flights with duration between 90 to 120 minutes, the lower fare cap has been increased to ₹3,900 from ₹3,500, while the cap on maximum chargeable fare has been increased to ₹13,000 from ₹10,000.
At present, the government has allowed domestic flights to operate up to 80% of their capacity.
Replying to a question in Parliament on Wednesday, Union civil aviation minister Hardeep Singh Puri said fare band on domestic flights can't be a permanent feature and it is expected that when airlines, which are now operating at 80 per cent of their pre-Covid capacity, resume their full services, they won't need fare bands.
The Centre fixed fare bands when airlines resumed their services in May 2020, after the national lockdown. In this process, the ministry determined the ceiling price of tickets so that passengers were not overcharged.
"The floor and ceiling price was an extraordinary measure which was necessitated by an extraordinary situation which we found ourselves in. It is designed to ensure that airlines in a situation of limited availability did not charge exorbitant prices. It is not our intention and can not be in an open market deregulated situation to have the fare band made a permanent feature," the minister had said.
