Praful Patel talks like a passenger, rejects exorbitant fare hike

Civil aviation minister Praful Patel on Friday allayed fears of travellers over a proposed “predatory and exorbitant” fare hike by airlines. The airlines have submitted a proposal for fare hikes, calculated on the basis of distance of travel, to the Directorate General of Civil Aviation (DGCA).

Patel on Friday rejected the distance-wise fare calculation proposal, saying tariff should be in slabs which are “sector-wise, category-wise and period-wise”. At any given time, the civil aviation minister said, a consumer should know how much he will have to pay for a sector on various days up to the flying day.

“He should clearly know the fare from point A to point B without having to calculate the distance. He should know the fares for each day till the flying day. Airlines may vary fares depending on when the booking is made, but this variation or bucket pricing should also be clear to the traveller at all times,” Patel said.
The minister stressed that the DGCA had enough powers to control this menace under rule 135 of the Aircraft Rules, 1937.

“Beginning tomorrow, each airline would be called for explanations by the DGCA and further action will be initiated if required,” he said. There was, however, no clarity on the powers enjoyed by the DGCA under the rule. Nasim Zaidi, civil aviation secretary, could only say, “The regulator had enough powers.”

He responded with a “please don’t spread panic” when asked if licences could be suspended for non-compliance of guidelines.
Airlines are not amused by the ministry’s response. A senior official of a budget carrier, in fact, pointed out that average fares between Delhi-Mumbai, the busiest domestic sector, had actually fallen from around Rs9,000 to Rs4,000 for a one-way flight in the last five years.

“This has happened despite the government doing nothing to help airlines’ cost structure. If the government wants to get into fare regulation, it may as well buy out airlines. Nowhere are fares dictated by government policy; they are based on competition. Any other way is pure foolishness,” he said.     

An aviation expert said that bucket pricing - almost always followed by airlines - makes differential fares available based on how early the ticket has been booked apart from whether the flight is full. Generally, 6-10 different fare options are available on any given day for most sectors.

As of now, price for a one-way flight between Mumbai Delhi is between Rs2,500-Rs16,000. As per the airlines’ proposal to the DGCA, the highest fare slab for travel of less than 750km comes to Rs14,000-Rs24,000. For the farthest travel within India, a distance of over 1,400km, fare slabs proposed were between Rs22,000-30,800.