Government Notifies New Airfare Rules, Allows Intervention In Ticket Prices During Extraordinary Situations

New Delhi: The government has notified new rules allowing it to intervene in airline ticket prices in extraordinary situations and in the public interest, amid concerns over high airfares in the backdrop of elevated crude oil and Aviation Turbine Fuel (ATF) prices.     

Under the Bharatiya Vayuyan Niyam, 2026, notified by the Union Ministry of Civil Aviation, the Centre can issue directions to airlines on fares if it considers intervention necessary in an extraordinary situation. Such directions must be proportionate to the circumstances and remain in force only for the specified period. 

According to Rule 192, airlines operating scheduled air services will have to determine their fares based on factors including the cost of operations and submit the tariff details to the Directorate General of Civil Aviation (DGCA).      

The rule states that the government may issue written directions if it is of the opinion that an extraordinary situation has arisen and intervention is necessary in the public interest. 

The new rules also require airlines to publish their fares on websites and other digital platforms to ensure transparency and keep passengers informed. The DGCA will monitor the tariffs set by scheduled airlines. 

The notification further strengthens transparency requirements in ticket pricing, making it mandatory for airlines to display the total amount payable by passengers during the booking process and on the ticket. 

Airlines will also have to provide a separate breakdown of the base fare, taxes, fees, cancellation charges, refund conditions and other applicable charges. 

The rules distinguish between taxes payable to the government and fees collected by airlines for services or facilities provided to passengers. 

India deregulated airline fare fixation in 1994, allowing carriers to determine ticket prices based on market conditions. The Civil Aviation Ministry has maintained that airlines generally set fares according to demand, operating costs and the time of booking, with different pricing bands available for passengers. 

Under the earlier Aircraft Rules, 1937, Rule 135(4) empowered the DGCA to issue directions if it found excessive or predatory pricing or oligopolistic practices in the aviation sector. 

While the newly notified Rule 192 retains the provision for monitoring airline tariffs, it does not specifically list excessive or predatory pricing and oligopolistic practices as grounds for government intervention. 

The new framework, however, provides the Centre with powers to issue directions on airline fares in extraordinary circumstances, subject to the conditions specified under the rules.