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Thursday, 18 April, 2019, 13 : 00 PM [IST]

Aviation Ministry to discuss soaring fares with airlines

According to Economic Times (ET), the aviation ministry has called a meeting of airlines and airports on Thursday to discuss ways to rein in soaring airfares on popular routes even as Jet Airways decided to suspend all operations from Wednesday night. 

The meeting, to be chaired by Pradeep Singh Kharola, Secretary, Ministry of Civil Aviation will look at issues such as “airfares on high density routes and additional deployment of capacity”, the ministry informed airlines and airports on Wednesday.

Fares on key routes have more than doubled in recent weeks and have become a concern for the government as Jet Airways— facing its worst financial crisis yet—cut its operational fleet to just five aircraft, down from 119 at its peak, and late Wednesday decided to suspend operations. An official data estimates that more than a million daily domestic seats went out of the system between January and February due to grounding of Jet aircraft. 

While the government has asked various airlines to add fleet to ensure that the passenger inconvenience is minimised on these routes, a recent order by the Directorate General of Civil Aviation (DGCA) has barred airlines from cancelling low-density routes and moving flights to trunk routes. The effect of the regulator’s order will be seen in a few days when airlines that have started these flights will have to cancel them. People in the know said the DGCA order could be part of the discussions on Thursday. “All these aspects are likely to be discussed,” a government official said on condition of anonymity. “We will find ways to ensure that the inconvenience to passengers is minimised.” 

An industry watcher said there is no way to reduce fares without increasing capacity. “Fares are a function of demand and supply and will increase, if there is a decline in demand,” the person told ET. “The government’s meeting, to me, is just a waste of time. The government can ask airlines to add capacity, but there is no way airlines can bring enough capacity to replace Jet Airways’.” Jet is estimated to have close to 400 unused departure slots across the country, including about 80 at Delhi and Mumbai, the two busiest airports in the country.

(Source: ET)

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