The Ministry of Civil Aviation on Friday has withdrawn the temporary fare cap imposed on domestic airfares, with the decision set to take effect from 23 March, 2026. The move comes after the government reviewed the restoration of airline capacity and the normalisation of operations following disruptions linked to the IndiGo crisis.
The fare cap had been imposed on Dec. 6 after an abnormal surge in ticket prices due to widespread disruptions caused by IndiGo, which led to reduced capacity and a sharp rise in airfares across several routes. With operations now stabilised and capacity largely restored, the ministry has decided to remove the pricing restrictions.
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However, the Ministry of Civil Aviation reiterated that airlines must continue to exercise pricing discipline and act responsibly, even in the absence of formal fare caps. The ministry emphasised that airlines should ensure fares remain reasonable, transparent and commensurate with prevailing market conditions.
The government also issued a strong warning against any excessive or unjustified surge in fares, particularly during periods of peak demand, operational disruptions or emergency situations. It stated that any such instances would be viewed seriously.
The ministry further said it will continue to closely monitor airfare trends on a real-time basis to ensure that passengers are not subjected to unreasonable pricing. It added that the government reserves the right to take appropriate regulatory or administrative measures if required in the public interest.
This includes the possible re-introduction of fare controls or other interventions if airfares rise sharply again or if market conditions warrant regulatory action.
The withdrawal of the fare cap signals a return to market-driven pricing in the aviation sector, but with continued regulatory oversight to prevent fare volatility and protect passenger interests.
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