Flight tickets in India: New rules give government power over fares from 2027

The Indian government will have the power to temporarily intervene in airline ticket prices from January 1, 2027, under new aviation rules. The move comes amid concerns over high airfares as crude oil and Aviation Turbine Fuel (ATF) prices remain elevated.

However, the rules do not introduce a permanent cap on ticket prices. Airlines will continue to set fares based on operating costs, demand and market conditions, The Economic Times reported.

When can the government intervene?

Under Rule 192 of the Bharatiya Vayuyan Niyam, 2026, the Centre can issue written directions to airlines to regulate fares if an extraordinary situation arises and intervention is considered necessary in the public interest.

Any intervention must be proportionate to the circumstances and remain in force only for a specified period, India Today reported. The rules, notified in the Official Gazette on October 31, do not define what constitutes an extraordinary situation.

No permanent cap on airfares

India deregulated airline fare fixation in 1994, allowing carriers to set prices according to market conditions. Airlines will not need prior government approval for individual fares under the new rules.

The Centre will retain the power to intervene temporarily, but the framework does not guarantee cheaper tickets or set a fixed upper limit on fares.

Airlines must disclose ticket charges

The rules also require airlines to display the total amount payable during booking and on tickets, with a separate breakdown of:

• Base fare and government taxes

• Airline fees and other applicable charges

• Cancellation charges and refund conditions

The Directorate General of Civil Aviation (DGCA) will monitor airline tariffs. Carriers will have to submit fare details to the regulator and publish them on their websites and other digital platforms.

Rules follow Supreme Court proceedings

The notification follows Supreme Court proceedings over allegations of arbitrary and excessive airfares. On October 16, Solicitor General Tushar Mehta told the court that the new rules had received administrative approval and would be published within two weeks. The court asked the Centre to submit the notified rules by November 16.

What this means for passengers: From January 1, 2027, the government can step in during extraordinary situations, but airlines will continue to set ticket prices in normal circumstances. Passengers will also get a clearer breakdown of fares and additional charges.