Domestic airfare caps to be removed from Aug 31: Govt

The ministry had imposed lower and upper limits on domestic airfares based on flight durations when services were resumed on May 25, 2020 after a two-month lockdown due to the COVID-19 pandemic.

Limits imposed on domestic airfares will be removed from August 31, after a span of approximately 27 months, the Union Aviation Ministry said on Wednesday.

"The decision to remove air fare caps has been taken after careful analysis of daily demand and prices of air turbine fuel (ATF). Stabilisation has set in and we are certain that the sector is poised for growth in domestic traffic in the near future," Aviation Minister Jyotiraditya Scindia said on Twitter.

ATF prices have been coming down during the last few weeks after jumping to record levels, primarily due to the Russia-Ukraine war that began on February 24.

On August 1, the price of ATF in Delhi was ₹1.21 lakh per kilo-litre, which was around 14% lower than last month.

The ministry had imposed lower and upper limits on domestic airfares based on flight durations when services were resumed on May 25, 2020 after a two-month lockdown due to the COVID-19 pandemic.

For example, airlines currently cannot charge a passenger less than ₹2,900 (excluding GST) and more than ₹8,800 (excluding GST) for domestic flights of less than 40 minutes.

The lower caps were there to protect the financially weaker airlines and the upper caps to protect passengers from high fares.