Govt may ask airlines to cut surcharges as fuel prices ease
New Delhi, June 25
The government may soon ask airlines to review and reduce surge pricing and additional passenger charges if the recent decline in crude oil and aviation fuel prices proves to be sustainable, Civil Aviation Minister K Ram Mohan Naidu said on Thursday.
The Centre is closely monitoring trends in aviation turbine fuel (ATF) prices and has initiated discussions with airlines to assess whether the current easing in fuel costs is likely to continue over the long term.
"At present, we are seeing prices coming down, but we need to assess whether this is a long-term reduction or a temporary fall. Discussions with airlines are underway," Naidu said.
The minister noted that the aviation sector has faced considerable challenges in recent months due to geopolitical tensions, which led to volatility in crude oil prices and increased operational costs for airlines. Higher fuel costs had prompted carriers to levy additional charges and adjust fares to offset rising expenses.
Naidu said the government would engage with airlines on reducing these extra charges once there is greater confidence that aviation fuel prices have stabilized over a sustained period. The objective is to ensure that the benefits of lower fuel costs are eventually passed on to passengers.
To support the aviation industry during periods of market volatility, the government has introduced several measures, including a Rs 10,000 crore price stabilisation fund. It has also implemented steps such as capping ATF prices for domestic scheduled airlines, reducing certain airport charges and extending emergency credit support to carriers.
The minister said the government will continue to closely track developments in global energy markets and domestic fuel prices before taking any further decisions regarding airfare reductions.
— IANS
Reader Comments
A Rs 10,000 crore stabilisation fund sounds good, but will it actually help reduce fares? In my experience, fuel prices fluctuate every 3-4 months due to global politics. The government should also look at reducing GST on ATF from 18% - that would be a more sustainable solution for affordable flying in India.
Good intentions but implementation is key. Airlines have been charging fuel surcharges of Rs 2,500-3,500 per ticket even when crude was at $75/barrel. Now with prices around $70, they should reduce at least by Rs 1,000-1,500. Otherwise it looks like the government is just making announcements without teeth. Let's see if they actually enforce this.
This is a sensible approach by the government. As someone who frequently travels between Delhi and Mumbai, I've noticed fares becoming really unpredictable. While I appreciate the price cap on ATF for domestic airlines, I hope the extended credit support doesn't encourage inefficiency. Competition in the sector is healthy, but we need sustainable operations from air carriers too.
This is typical - government says "we might ask airlines" but never actually forces them. Remember last year when fuel prices dropped but airlines took 6 months to reduce fares? Meanwhile, we middle-class families are forced to travel by train because flights are too expensive. The government needs to be more proactive, not just "monitoring" and "discussing" all the time. 😤
J James A Good to We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.