The government is not in favour of interfering in a free market economy by putting caps on airfares, Civil Aviation Secretary Rajiv Bansal said on Tuesday amid concerns over possible predatory pricing of air tickets.
The remarks also come against the backdrop of a Parliamentary panel, earlier this month, asking the civil aviation ministry to cap the upper and lower levels of airfares, and ensure that predatory pricing mechanism is not adopted by airlines under the cloak of free market economy.
"Fundamentally, putting (fare) caps and interfering in the market economy is not good and we are not in favour of it. We are not in favour of putting lower or upper caps. I don't think the government should interfere in a free market economy at all...," Bansal said.'
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However, he said "we have taken up with airlines to see that passengers are not unduly charged or inconvenienced because of very high fare buckets, the highest bucket".
According to him, tickets are sold in around 16 fare buckets. "I would feel that the lower fare buckets on any sector are comparable to AC train fares...".
In its report tabled in Parliament on March 13, the panel also said a perfect balance has to be maintained between the commercial interest of the private airlines and the interest of passengers.
The recommendations have been made by the Department-related Parliamentary Standing Committee on Transport, Tourism and Culture in its report on the ministry's demand for grants for 2023-24.
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