According to Minister of State for Civil Aviation Jayant Sinha, the government's intervention to reduce air fares will be anti-competitive.
"An intervention by the government in the matter of airfare reduction of domestic airlines operating on international sector to protect the interest of NRIs would not only be in contravention of Indian law, but also anti-competitive," the minister informed parliament.
"Airlines offer fares on various levels, which are driven by market forces. As the demand goes up, the seats on lower fare levels get filled. This is a global practice in the aviation industry," Sinha said in a written reply to a question in the Rajya Sabha during question hour.
The minister elaborated that airlines are free to fix reasonable tariffs under the provision of Aircraft Rules, 1937.
"However, airlines remain compliant with the regulatory provisions of sub-rule 2 of Rule 135 as long as the fare charged by them does not exceed the fare established and displayed on their website," Sinha added.
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