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. File | Photo Credit: Velankanni Raj B 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.Although the rules do not define “extraordinary situations,” the government has intervened in airfares before.

It imposed fare bands during the COVID-19 pandemic and after IndiGo’s operational meltdown last December, when nearly 5,000 flights were cancelled. 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.The move follows a public-interest litigation filed by social activist S. Laxminarayan, seeking binding regulatory norms to curb arbitrary airfare pricing and ancillary charges levied by private airlines during festive periods, holidays, and emergenciesMonitoring faresThe rules also provide for closer fare monitoring.

Airlines must submit their tariffs to the Director General of Civil Aviation (DGCA) in the form, manner and at intervals specified.They must also publish tariffs on their websites or other DGCA-specified digital platforms to improve public awareness and transparency.Fares displayed on booking websites and tickets must show the total amount payable, along with a detailed breakdown of the base fare, taxes, fees, cancellation charges, refund conditions, and other applicable costs.No fare capsAirlines were already required to submit fare data to the DGCA and publish it on their websites under Air Transport Circular 2 of 2010, issued on November 19, 2010. These requirements have now been incorporated into the rules.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.

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. Published - November 02, 2026 08:07 pm IST