Domestic Air Fare: Know How Govt Can Slash Rates As Passenger Traffic Booms

In the first 6 days of September, 2 million people have travelled by air every day. In August, 65,26,753 people travelled by air in 57,498 flights in the country.

Representative Image.

New Delhi: The Aviation Industry, which has been sluggish over the past year due to the Covid-19 pandemic, now seems to be coming back on track. In the first 6 days of September, 2 million people have travelled by air on a daily basis. Similar figures were seen in the month of August where 65,26,753 people travelled by air in as many as 57,498 flights across the country. This was a 33 per cent hike compared to the number of passengers in July. 

The central government had announced some relaxation in air travel rules from August following a reduction in Covid-19 cases. Relaxing travel rules and increasing numbers of passengers are a sign that the government may soon drop the airfares. The government has announced hikes two times for domestic flight fares, first on June 21 and then on August 13.

Rule Behind Airfares 

Earlier, the government used to issue instructions on airfares to airline companies by regulating circulars for a fixed time. Companies had to fix fares by adhering to these guidelines. After the circular deadline was over, the government used to issue another circular.  

Now as per the new rules, the Ministry of Civil Aviation has a minimum fare rule in force for a 30-day deadline. Airline companies are then allowed to fix fares according to their own rules.

Because of this, companies can offer tickets with discounts and other offers. However, due to the new rule, airline companies who used to offer low price tickets till the departure are no longer able to do so. 

How Airfares Can Be Reduced  

After a time limit of 30 days, the fare starts to rise. Airlines are not allowed to sell tickets at a price lower than the minimum fare until before departure. The government needs to do away with this rule designed to benefit smaller airlines.

At the same time, companies also need to choose the right business model. The model of low fares with more passengers would give more profit than implementing high fares with low passengers.    

Lower Airfare After 30-Day Window 

After a 30-day window, air travel tickets are available at extremely low prices. The flight ticket from Mumbai to Delhi, which is currently available for Rs 5,310, is costing Rs 1,937 in October after a 30-day window.

Considering long-distance flights, currently, the ticket from Delhi to Kochi is Rs 7,820, but after a 30-day window, it is available for Rs 3,307. The same applies to flights of Bangalore-Guwahati, Delhi-Chennai, and Bangalore-Lucknow. 

The government will have to work out a plan to reduce airfares. It needs to create a better synergy between making travel affordable for passengers and the profits of airlines companies.

Reducing overnight fares can become a challenge for airlines companies. For this, the government has to work in a time-bound manner.