India lifts domestic airfare caps, giving relief to airlines

The Ministry of Civil Aviation has announced it will withdraw temporary fare caps on domestic flights starting Monday, March 23.

The decision ends the price-control regime introduced several months ago to manage volatility in the aviation sector.

The Ministry said the fare caps, initially imposed on December 6, 2025, aimed to contain abnormal ticket price spikes caused by large-scale flight disruptions at IndiGo. The move sought to protect passengers and ensure affordability during a period of constrained capacity.

Fare caps no longer needed

According to the official order, the aviation sector has stabilised with restoration of flight capacity and normalisation of operations. Based on this assessment, the government has decided the December fare cap “shall stand withdrawn with effect from 23rd March, 2026,” allowing airlines to set prices according to market demand and supply.

Ministry urges responsible pricing

While deregulating fares, the Ministry reminded carriers to exercise discipline and act responsibly. Airlines are expected to maintain fares that are reasonable, transparent, and aligned with market conditions, ensuring passenger interests are not adversely affected.

Monitoring continues, controls may return

The Ministry warned that any “excessive or unjustified surge in fares” will be treated seriously, particularly during peak demand or operational disruptions. It will continue to monitor airfare trends in real time and reserves the right to take regulatory action, including the possible reintroduction of fare caps, if required in the public interest.