On looking at the fluctuating airfares and also in order to cap the upper and lower levels of the same, a Parliamentary panel has asked the civil aviation ministry to ensure that predatory pricing mechanism is not adopted by the airlines under the cloak of free market economy.
The observations have been made by the department-related Parliamentary standing committee on transport, tourism and culture, which tabled its report in Parliament on Monday on the ministry's demand for grants for 2023-24.
The committee has also expressed concerns about the high fares charged by the private airlines in the domestic sector and also pointed out the wrong information published by the private airlines on their websites, regarding the number of seats left in the flight and the prices of the tickets.
“The level of misinformation can be gauged from the fact that even after the last tickets have been sold, the same number of seats show on the website, as indicated before the tickets sale. This indicates that airline operators are misguiding the public and forcing passengers to pay more. In view of the above, the committee recommends that the ministry should formulate appropriate guidelines regarding rationalisation of fares and publishing the correct information on the website of the airlines,” the report said.
Making further observations, the committee went on to recommend that there should be a mechanism with the ministry such as capping of upper and lower prices to stop the practice of 'predatory pricing' or the sudden surge in prices.
“The committee is of the firm opinion that a perfect balance has to be maintained between the commercial interest of the private airlines and the interest of the passengers so as to enable the private airlines to grow and at the same time the interest of passengers should also be kept in mind, so that they are not fleeced in the garb of commercialization. The committee feels that even though price buckets are being created as per international aviation norms, a close watch has to be maintained by the DGCA & the ministry and a mechanism should be devised to monitor the websites of various airlines to prevent them from misguiding passengers. And, in case the private airlines do not publish the correct information regarding fares, they should be penalized for it,” the report stated.
The committee also observed that at present, the surge in airfares does not reflect any sort of mechanism on part of the ministry to control the fares, based on existing Aircraft Rules, 1937, as during surge in air fares the prices go beyond the acceptable or justifiable limits of 'reasonable profit and generally prevailing tariff'.
The committee has recommended that the ministry should formulate a pricing mechanism for air fares to ensure that passengers are not charged exorbitant prices. The committee also recommended that the DGCA may be empowered to regulate tariffs based on the data generated by their monitoring department or otherwise. Further, the passengers may also be given an option to approach the said department with their grievances.
First Published: Mar 14, 2023 12:26 PM IST
