According to a report by Mihir Mishra, in the Economic Times, airlines will be free to charge less than INR 2,500 per hour on regional routes, said Ashok Gajapathi Raju, Civil Aviation Minister. His comment offers a relief to carriers that had raised concern over the price fixed by the government in the recently released draft aviation policy.
"Yes, you can offer below INR 2,500 per hour," said Raju, replying to a question on AirAsia CEO Tony Fernandes' statement that the airline can offer fares lower than the amount mentioned in the draft policy.
The minister said the competition has taken care of fares on some routes, while this has not happened on the other routes. "So, how do we do that? We are not forcing this fixed fare on anyone. We are rather trying to achieve it by various incentives that these regional flights will get," he said.
The government promised a slew of incentives such as waiver of central excise duty about 8% on fuel and service tax of about 4.94% on flights under the regional connectivity plan announced in the draft policy.
Over and above these, regional flights will also get waiver passenger services fee (PSF), used to fund the cost of providing security at airports, of INR 149 per ticket and 1% value-added tax on jet fuel.
11/11/15 Travel Biz Monitor
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"Yes, you can offer below INR 2,500 per hour," said Raju, replying to a question on AirAsia CEO Tony Fernandes' statement that the airline can offer fares lower than the amount mentioned in the draft policy.
The minister said the competition has taken care of fares on some routes, while this has not happened on the other routes. "So, how do we do that? We are not forcing this fixed fare on anyone. We are rather trying to achieve it by various incentives that these regional flights will get," he said.
The government promised a slew of incentives such as waiver of central excise duty about 8% on fuel and service tax of about 4.94% on flights under the regional connectivity plan announced in the draft policy.
Over and above these, regional flights will also get waiver passenger services fee (PSF), used to fund the cost of providing security at airports, of INR 149 per ticket and 1% value-added tax on jet fuel.
11/11/15 Travel Biz Monitor
