Government Withdraws Temporary Airfare Caps, Says Curbs May Return If Ticket Prices Rise

The Indian Ministry of Civil Aviation has lifted temporary fare caps on domestic routes as capacity normalises. The DGCA will monitor fares in real time and has reserved the right to reintroduce controls if prices rise unjustifiably, particularly during peak periods or disruptions.

The Ministry of Civil Aviation has decided to remove temporary limits on domestic air ticket prices, but warned airlines that any sharp, unjustified jump in fares could lead to controls returning on key routes and sectors.

The fare caps, first applied in December on select domestic routes, will no longer apply from March 23, under an order issued by the Ministry of Civil Aviation. The Directorate General of Civil Aviation has been instructed to track fares across airlines in real time.

Domestic airfares fare cap withdrawal and monitoring

The ministry order stated: "Whereas, 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across the sector, upon review, it has been decided that the fare cap imposed vide the aforesaid letter shall stand withdrawn with effect from 23rd March, 2026."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 ministry stressed that the limits on fares had been brought in as a short-term step. The order recalled that the measure was designed "to contain an abnormal surge in ticket prices arising out of large-scale flight disruptions and to safeguard passenger interests and ensure affordability during a period of constrained capacity."

The government first fixed the maximum one-way domestic airfare at ₹18,000 on December 6. That move followed extensive cancellations by IndiGo, which caused major schedule disruption and reduced available capacity, prompting the ministry to step in to shield passengers.

The latest decision followed a meeting on March 18 between the civil aviation ministry and three airlines, Air India, IndiGo and SpiceJet. During the talks, the carriers highlighted operational problems linked to the continuing West Asia crisis and pressed for the removal of the temporary fare caps, also writing separately to the government.

To underline its firm stance, the order cautioned that any steep or unjustified jump in ticket prices, especially during peak seasons, disruption periods or emergencies, "will be viewed seriously." It added: "The Ministry will continue to closely monitor airfare trends on a real-time basis. The Ministry reserves the right to take appropriate regulatory or administrative measures, including re-introduction of fare controls or other interventions, if required in public interest."

Key details from the ministry’s decision and earlier intervention are summarised below.

With capacity now restored and operations described as normal across the sector, the ministry has stepped back from direct fare setting, while keeping a close watch on pricing behaviour and leaving open the option of reimposing controls if passenger interests are threatened.