Parl panel wants separate body for air fares

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Air travel is becoming expensive day by day. Fares increase drastically during festivals and holidays. Airlines companies increase fares arbitrarily. To deal with such a situation, a parliamentary panel has given some suggestions.

The Parliamentary Standing Committee on Transport, Tourism and Culture on Thursday presented its report on its recommendations on the issue of determination of airfares. The report proposes creation of a separate unit to decide on capping and control prices.

In the report, the panel said that it has found many such examples in which it found that airlines are adopting arbitrary attitude regarding fares. There has been an abnormal increase in air fares especially during festivals or holidays.

During this time, companies do not even follow the rules made by themselves. The panel has recommended that a system should be developed to control this, so that aviation regulator DGCA gets the authority to control air fares. At present, air fares are neither decided nor controlled by the government.

Fares according to routes The report said that the committee is of the opinion that route-specific fare caps should be fixed keeping in mind the interests of both airlines and customers. Capping should be decided with prior notice during festivals or busy schedules to protect the commercial interests of airlines.

According to the committee, commercial interests such as revenue management and enhancing shareholder value decide air fares, but passenger interests have no role in it. Therefore, a system should be devised to ensure compliance with Rule 13 (1) of the Ministry of Aircraft Rules, 1937.

The panel also said that the policy of changing seat prices for the same flight needs to be reconsidered as it is against the principle of equity.

Indigo shares take a hit

Shares of airline IndiGo’s parent company InterGlobe Aviation Limited have taken a hit on back of the  parliamentary panel’s proposal for route-specific capping of air fares and control over air ticket prices. The company’s shares fell by about 5% on Friday. InterGlobe Aviation’s stock fell 4.7% to Rs 2982.40 on BSE from its previous closing level of Rs 3130.15.