The Union government can now issue written directions to airlines on air fares in the public interest during “extraordinary situations,” according to new rules framed under the Bharatiya Vayuyan Adhiniyam, 2024, and notified on the e-Gazette website on October 31.
It has also informally urged airlines to restrain fares during the Kumbh Mela, or in the aftermath of Pahalgam attacks, and natural disasters, including the Kerala floods, following complaints of price gouging. The new rules now provide a regulatory framework for such interventions. It has often maintained that ticket prices can change dynamically in response to demand and supply, as well as factors such as seat occupancy, fuel costs, aircraft capacity, and seasonal trends.
It imposed fare bands during the COVID-19 pandemic and after IndiGo’s operational meltdown last December, when nearly 5,000 flights were cancelled. By providing for price monitoring in normal circumstances and refraining from imposing fare caps, the government has stuck to its position that airfares are market-driven and are not subject to direct regulation, following the repeal of the Air Corporations Act in March 1994.
” the government has intervened in airfares before Although the rules do not define “extraordinary situations.
