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Business News – Domestic air travel costlier by 12.5%

Business News: Flying within the country will cost more from Friday the 13th. The aviation ministry late on Thursday night increased both the minimum and maximum domestic airfare levels by 12.5%. The move came along with the government allowing airlines can now operate a maximum of 72.5% of their pre-Covid domestic flights instead of the 65% allowed till date. The carriers have been operating 65% of their pre-Covid domestic flights since July 5 according to the ministry’s order. Between June 1 and July 5, the cap was at 50%.

The ministry issued a fresh order on Thursday, wherein it modified the July 5 order stating that “65% capacity may be read as 72.5% capacity”. Thursday’s order also noted that the 72.5% cap will “remain in place until further order”.

When the government had resumed the scheduled domestic flights on May 25 last year after a two-month break, the ministry had allowed the carriers to operate not more than 33% of their pre-Covid domestic services.

The cap was gradually increased to 80% by December. The 80% cap remained in place till June 1. The May 28 decision to bring down the cap from 80 to 50% from June 1 onwards was taken “in view of the sudden surge in the number of active COVID-19 cases across the country, decrease in passenger traffic and the passenger load (occupancy rate) factor”, the ministry had said.

Several airlines and airport operators are asking the government to free up the sector from its pandemic-time control and let market forces decide capacity and fares to help revive the sector. The entire travel industry, including airlines and hotels, realise that their survival rests on domestic travellers as international travel could take a long time to open up both ways – Indian tourists being allowed in most countries and foreign tourists being allowed into India. This fact is recognised by government agencies too.
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