Indigo airline crisis: Centre plans temporary caps to rein in soaring domestic airfares

Hyderabad: The government has moved to rein in soaring domestic airfares by imposing temporary caps following IndiGo’s week-long operational crisis, which caused severe nationwide disruptions.

Disruptions enter sixth day

IndiGo cancelled more than 1,600 flights over the past week, leading to reduced capacity and what the Ministry of Civil Aviation described as an ‘unreasonable surge’ in ticket prices.

IndiGo cancelled more than 220 flights at Delhi and Mumbai airports on Sunday, as the disruptions entered the sixth day, while efforts are on to normalise operations.

In an order issued, the ministry barred airlines from charging above fixed ceiling rates based on sector distance:

- Rs 7,500 for routes up to 500 km

- Rs 12,000 for 500–1,000 km

- Rs 15,000 for 1,000–1,500 km

- Rs 18,000 for routes over 1,500 km

These caps exclude UDF, PSF and applicable taxes, and will not apply to Business Class or RCS-UDAN services.

Currently, ticket prices between Bengaluru to Visakhapatnam, Kolkata to Hyderabad, and Delhi to Hyderabad range between Rs 8,000 to Rs 15,000.

Monitor regular fares

The order, effective immediately and approved by the competent authority, also directs the DGCA to ‘monitor and regulate’ fares on the specified routes.

The ministry said the decision has been taken ‘in public interest’ and will remain until prices stabilise or further review is conducted. The fare ceilings apply uniformly across all booking platforms, including airline websites and OTAs.

For example, a ticket from Bengaluru to Visakhapatnam on regular days costs Rs 5,000, while the prices in December are Rs 11,000.

Similarly, a flight ticket from Kolkata to Hyderabad on regular days costs Rs 5,000, while the prices in December are Rs 9,000.

Airlines ordered to maintain regular standards

Airlines have been instructed to ensure adequate seat availability across fare buckets, consider deploying additional capacity on high-demand routes, avoid sudden fare spikes on sectors impacted by cancellations and offer maximum assistance to affected passengers, including rebooking options.

The government said it is invoking its regulatory authority to ensure ‘fair’ and ‘reasonable’ pricing and prevent ‘opportunistic fares’ during the ongoing disruption.

Soon after the announcement, Air India clarified that it has already been controlling fares on domestic routes. The airline said it has been capping economy-class ticket prices on all non-stop domestic flights since December 4.

“Air India and Air India Express have proactively capped economy fares from December 4 to prevent the usual demand-supply driven spikes,” the airline spokesperson stated.