Flights Price Capping: The ministry of civil aviation on Friday extended restrictions on limited domestic flight operations and caps on airfares till November 24.

Currently, the Centre has allowed domestic flight operations to function at 45% of their total capacity. “We will be extending our capacity of flight operations. At present, flight operations are at around 28%, we will extend the capacity beyond the 45 % limit soon,” a senior ministry official said.

“As per the prevailing situation of COVID-19, the Central government…directs that the order shall remain in force till 2359 hrs on 24th November 2020, or until further orders,” the Aviation Ministry said.

The decision comes after Aviation Minister Hardeep Singh Puri during a press briefing had said that the price cap on domestic routes will be applicable well beyond August 24.

Aviation regulator Director General of Civil Aviation in May had imposed fare limits for these bands — domestic flights of less than 40-minute duration to have lower and upper limits of Rs 2,000 and Rs 6,000. Fare limits for flights of 40-60 minutes are Rs 2,500 and Rs 7,500, for 60-90 minute flights, they are Rs 3,000 and Rs 9,000 and fare limits for 90-120 minute-flights are Rs 3,500 and Rs 10,000. Flights of 120-150 minute duration have Rs 4,500 and Rs 13,000 and those of 150-180 minutes have Rs 5,500 and Rs 15,700 as the lower and upper limits respectively.

Airlines should adhere to the upper and lower limit of fares prescribed by the ministry during the Covid-19 pandemic, the ministry had said.

The aviation minister had said the move will mean that the lowest fare between Delhi and Mumbai, the busiest route in the country, will be capped at ₹3,500 and ₹10,000 at the higher end.

The government’s decision to temporarily fix a cap on airfares following the resumption of domestic passenger flight services in a graded manner is impacting air travel demand as airlines are unable to offer tickets at lower prices to customers, aviation thinks tank Centre for Asia Pacific Aviation (CAPA) said earlier this month.

CAPA said adopting such a mechanism takes away an airline’s flexibility to charge fares at a lower rate when demand is on the lower side. “The temporary fare caps by the regulator are impacting demand. The pricing restrictions mean that the airlines have less flexibility to offer lower fare to stimulate demand.”