Centre removes caps on airfares after three months

The Centre lifts air fare caps after three months, citing stabilized operations and rising aviation fuel costs amid geopolitical tensions.

The Centre has withdrawn air fare caps that were introduced in December to curb spike in ticket prices after IndiGo’s widespread flight cancellations.

The Ministry of Civil Aviation said in an order dated March 21, “The prevailing situation has since stabilised, with restoration of capacity and normalisation of operations across the sector, upon review, it has been decided that the fare cap imposed vide the aforesaid letter shall stand withdrawn with effect from 23rd March, 2026.”

The decision comes at a time airlines are hit hard by the conflict in West Asia leading to increase in aviation turbine fuel (ATF) prices as well as flight cancellations and re-routings that burn more fuel and are costlier.

The Ministry, however, said that airlines must ensure pricing discipline. “Airlines shall ensure that fares remain reasonable, transparent and commensurate with market conditions, and that passenger interests are not adversely impacted.”

It also warned of regulatory action, including reintroduction of fare caps if there was an unjustified surge in fares.