Government hikes domestic air fares by 15%

NEW DELHI: The government has hiked minimum domestic fares by about 15% from June 1 while slashing allowed flights within the country to 50% of pre-Covid times, from the current 80%, in wake of the catastrophic second wave, from the same date.
As a result, for instance, Delhi-Mumbai one-way minimum fare will rise from Rs 4,100 to Rs 4,700 (taxes extra). Maximum fares in domestic bands have not been changed.
This is the third hike this year due to spiralling jet fuel prices, the biggest cost item for airlines — with a majority of Indian carriers struggling to survive in the absence of any fiscal support from the government during the pandemic.
The range is for economy one-way fares and does not include user development fee of airports, passenger security fees (Rs 150 for domestic) and GST.
Due to the drastic fall in demand, most airlines were anyway operating less than half of pre-Covid number of domestic flights.
“In terms of change in capacity, this order makes no difference as airlines were operating 50% or less despite being allowed 80%. Once, and hopefully soon, when the situation improves, government clearance will be needed to increase number of flights beyond the allowed 50% from June 1,” said airline officials.
“In view of the sudden surge in number of active Covid cases across the country, decrease in passenger traffic and passenger load factor (aircraft occupancy), the existing cap of 80% is reduced to 50% from June 1,” says an order issued by aviation ministry joint secretary S K Mishra on Friday.
Aviation minister H S Puri had Tweeted this Tuesday: “Beginning with about 30,000 passengers on May 25, 2020, number of daily passengers crossed 3 lakh on several occasions. Fewer people are travelling during this second wave. But with more people getting vaccinated, we are hopeful the domestic aviation figures will again pick up.”
The deadly ongoing surge has seen the daily traffic fall to below 50,000 in recent days.
When schedule domestic flights resumed after a two-month break on May 25, 2020, the government had asked airlines to start with one-third of pre-Covid time flights and also fixed fare bands to ensure two things — passengers are not fleeced and financially strong airlines do not resort to predatory (below cost) fares to hasten the bankruptcy of weaker ones.
Based on flying time, there are seven categories: starting at flights below 40 minutes and going upto 3-3.5 hours.
Exactly a year after the restart, the crippling Covid surge has seen allowed capacity fall to 50% after rising to 80% and getting to within range of pre-Covid times earlier this year.

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