New Delhi, Jan 1: In the backdrop of huge losses borne by airlines, Aviation Minister Hardeep Singh Puri has said the government is concerned that more airlines will shut down if predatory pricing continues. "Some predatory pricing is taking place" in airfares, the minister told reporters on Tuesday. Mr Puri however ruled out any plan by the government to regulate airfares. The remarks come amid high competition in the country's aviation sector, struggling against high fuel prices and other operating costs.
"The interesting thing that we have observed is that on Delhi-Mumbai route 20 years ago, the average fare was Rs 5,100. Today, the average fare is Rs 4,600. Some predatory pricing is taking place. It means people are selling tickets below their cost," he said.
"One of our concerns is that if there is predatory pricing, then the airlines will stop functioning. This is not Air India's problem only. Jet Airways got shut down. Before that, it was Kingfisher airline," he said.
IndiGo and SpiceJet - two of the country's biggest airlines - reported losses of Rs 1,062 crore and Rs 463 crore respectively in the second quarter of 2019-20. Other airlines have also reported losses in the quarter that ended on September 30, 2019.
Asked if predatory pricing is the reason for the ill health of the airlines, the minister said, "No, there are many reasons... Predatory pricing is one of the factors. But the profitability of an airline is dependent on (a) number of things."
Asked if the trend of predatory pricing has come down after regular discussion with the airlines, he said, "Yes, absolutely."
"It is (a) constant battle. An ideal situation from an airline's point of view is that they grow and they are also able to charge more fares. What fares they charge is their business. Our advice to them is to charge realistic fares," he added. "It should not be too high. And it is not in your business interests if you are imposing predatory fares."
The minister also said that the government is not planning to regulate fares. "No regulation. It has to be done within deregulation system.... If I put a cap on fare, the airline will start charging that cap only... that cap will become the normal fare... So, within a deregulated structure, we have to bring about an equilibrium," the minister said.
"Government, periodically, at my level or at secretary''s level, we sit down with the main aircraft operators and tell them it is in your interest not to allow such practices which undermine the civil aviation sector."
Comments
Paise aur taktha ke liye kuch bhi karega a sanghi rss sevak. Now thier lab test is with MP state and just fooling the people. Major post all are filled wiht their so called brahmins. No chance to any other hindu castes.
People awake and think about our future. To ask and pray with the creator GOD there is no middle man or any supporter. Every one can pray directly with the creator god.
These baba etc all are fake and nothing logic or they are the agent of creator.
Feku said the "truth"
- you should mention that -
during his rule only more dalits got killed by saffron people.
- more attack on dalits during your rule.
more ambedkar's statue beheaded during your rule in yogi's UP.
and still counting the 'honourings'
So.. I think this is too much of honour for Ambedkar from you dear feku
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