Private Airlines Summoned by Parliamentary Panel to Discuss Soaring Airfares

On April 5, the Department Related Standing Committee for Transport, Tourism, and Culture summoned representatives from various private airlines and the Association of Private Airport Operators (APAO) to discuss the pressing issue of soaring airfares throughout India.

Indian Airlines

An official source informed ANI that the secretariat had extended invitations to multiple private airlines and APAO members to address this matter of urgent public concern. IndiGo, Vistara, GoAir, Air India, and SpiceJet are among the airlines asked to appear before the committee chaired by YSRCP Rajya Sabha MP Vijaysai Reddy.

Another source told ANI that this issue was crucial since it affected the common people. Most flights have exorbitant airfares, causing concern. Hence, the committee will seek answers and justification from the appropriate authorities. Industry experts suggest that due to global supply chain disruptions and high fuel prices, airlines are unlikely to lower their fares despite the significant rise in passenger travel.

MP Priyanka Chaturvedi of UBT Sena questioned whether the Government had circulated a draft paper proposing a 30% increase in landing and parking fees for aircraft and a four-fold increase in user development fees.

The question posed was whether the government had considered the impact on commuters of flight tickets becoming 30% more expensive. In response, MoS Civil Aviation Ministry, General Dr. VK Singh (Retd), informed Parliament that the Government of India had established the Airports Economic Regulatory Authority of India (AERA) in 2009. The authorities determined the tariff of aeronautical services at major airports, charged fees to passengers, and monitored the performance standards of services. The Central Government defined major airports as those that had an annual passenger throughput of more than 3.5 million or those that were notified as such. Currently, 27 airports are classified as major airports under the AERA Act of 2008.

The Government regulates non-major airports falling outside the purview of AERA under the provisions of the Aircrafts Act of 1934 and Aircraft Rules of 1937, which have been amended from time to time.

Ministry of Civil Aviation (MoCA)

The Ministry of Civil Aviation (MoCA) has published a concept paper to solicit comments from stakeholders on the proposed principles of tariff regulation for non-major airports. The paper suggests categorizing non-major airports into three clusters for the purpose of determining tariffs, with an upward revision of existing tariffs at such airports.

The aim is to reduce regulatory uncertainties, enable airport operators to obtain a reasonable rate of return on their deployed assets, achieve financial viability of operations, and facilitate investment decisions by non-major airport operators and developers. After consultation with stakeholders, the authorities will finalize the tariff for non-major airports.

It is worth noting that there has been a significant increase in domestic air travel in India since November of the previous year.

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