India Caps Domestic Airfares After Price Surge

India’s Civil Aviation Ministry has introduced temporary fare caps on domestic flights to stabilise ticket prices after widespread cancellations and price spikes. New limits aim to protect travellers and restore normal airline operations.

Government Steps In After Unprecedented Fare Spike

After a turbulent week of large-scale IndiGo cancellations and soaring last-minute ticket prices, India’s Ministry of Civil Aviation (MoCA) has intervened to bring stability back to the domestic air travel market.

Through Order No. 01/2025, issued on 6 December 2025, the Ministry imposed a temporary ceiling on economy-class domestic airfares—ensuring airlines cannot exceed a defined pricing range until flight operations return to normal.

What the New Domestic Fare Cap Mandate Includes

According to MoCA's latest circular, airlines are now required to follow strict maximum fare thresholds for all one-way economy tickets. These caps are intended to prevent sudden, unjustified fare spikes during operational disruptions.

Where and How the Fare Cap Applies

MoCA’s order is applicable across all distribution channels, ensuring transparency and fairness for passengers and travel partners:

• Applies to airline websites, OTAs, GDS systems, and all booking platforms

• Airlines must maintain availability across all fare buckets

• Carriers have been advised to deploy additional capacity on high-demand routes to avoid last-minute fare surges

• The rule aims to stabilise the market until flight schedules and seat availability return to normal levels

Why the Government Introduced Temporary Fare Caps

Over the past few days, the domestic aviation sector experienced severe disruptions due to hundreds of IndiGo flight cancellations, impacting major metros and key routes. The sudden drop in capacity created a ripple effect:

• Last-minute fares surged to ₹50,000–₹70,000 on popular routes

• Other airlines struggled to meet demand

• Travellers and travel agencies faced unpredictable pricing and operational chaos

MoCA stated that a single airline’s large-scale disruption triggered unreasonable fare inflation, and implementing fare caps was necessary to protect consumers and maintain market stability.

How Long Will the Fare Caps Remain in Effect?

The government has not announced a fixed end date. Officials have confirmed that restrictions will stay in place until cancellations reduce and airline operations normalise.

Once capacity is restored across all carriers and no abnormal pricing trends are observed, the Ministry is expected to withdraw the temporary ceilings.

What Travel Agents and Travellers Should Expect

For upcoming travel, customers will now see far more predictable and reasonable fare ranges—regardless of demand surges. While the capped amounts represent the base fare, additional airport fees, taxes, and charges may still apply.

For B2B travel professionals, this update ensures:

• More stable pricing for corporate and group travel

• Easier forecasting of client budgets

• Reduced customer dissatisfaction caused by sudden fare spikes

• Better planning for high-demand sectors during ongoing operational recovery

Takeaway for the Aviation & Travel Community

This government intervention brings much-needed relief to the aviation ecosystem—travel agents, airlines, corporates, and travellers alike. The temporary fare cap aims to restore sanity, protect consumers, and maintain supply-demand balance while airlines stabilise their operations.

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