NEW DELHI, July 26:
Government intervening to reduce airfare charged by domestic airlines on international routes will not only violate Indian law but will also be anti competitive, Union Minister Jayant Sinha said today.
Emphasising that airfares are driven by market forces, he said as the demand goes up, the seats on lower fare levels get filled.
“An intervention by the government in the matter of airfare reduction of domestic airlines operating on international sector to protect the interest of NRIs (Non Resident Indians) would not only be in contravention of Indian law but also anti-competitive,” he told Rajya Sabha in a written reply.
The Minister of State for Civil Aviation was responding to a query on whether the government is aware that in certain seasons airlines charge higher than norms in the case of Kerala-Gulf flights and whether the government would intervene.
Sinha also said airlines are free to fix reasonable tariffs under the Aircraft Rules, 1937 after taking into consideration all relevant factors including the cost of operationa, characteristics of service, reasonable profit and generally prevailing traffic.
Airlines remain compliant with regulatory provisions as long as the fare charged by them does not exceed the fare established and displayed on their website, he added. (PTI)
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