The recent cap on domestic tickets imposed by the aviation regulator in the wake of the IndiGo crisis has helped the tourism industry bounce back significantly, with ticket prices remaining between ₹8,000 and ₹10,000 even on the longest domestic routes during the peak tourist season, despite an increase in jet fuel prices.
The IATA Agents Association of India (IAAI), in its representation to the Union Civil Aviation and Tourism Ministers – K. Rammohan Naidu, Gajendra Singh Shekhawat, Murlidhar Mohol and Suresh Gopi – urged the permanent institutionalization of domestic fare caps to boost tourism and boost regional air connectivity.
According to tourism industry insiders, the aviation crisis in December with the suspension of IndiGo flights across the country dented the prospects of the tourism industry in Kerala, which was then gearing up for the Christmas and New Year season with massive cancellations. A price cap introduced by the Ministry of Civil Aviation that regulated economy class air fares for domestic flights starting from a cap of ₹7,500 for a flight distance of 500 km, ₹12,000 up to 1,000 km, ₹15,000 for longer flights up to 1,500 km, ₹0,000 back to the industry in January, up to 0 0 storms.
But in February, things returned to normal and airfares are returning to the previous regime of demand-driven price hikes, said James Kodianthara, former chairman of the Indian Association of Travel Agents (IATO) Kerala chapter.
For example, an IndiGo flight to Delhi from Thiruvananthapuram on February 26 costs ₹20,013, while the Air India fare is about ₹20,193 on the same route. Air India’s fare to Delhi from Kochi on February 26 is ₹19,251, while IndiGo charges ₹18,156. The ministry invoked regulatory powers to ensure fair and reasonable fares on all affected routes. But airlines are now resorting to dynamic pricing, he said.
According to Biji Eapen, IAAI’s national president, the measures introduced soon after the airline crisis have curbed exploitative price increases, protected passengers during emergencies and stabilized the domestic airline market. The Center should be prepared to continue to limit domestic air tickets as a permanent and legally enforceable cap with no seasonal, event or demand based pricing that would under no circumstances allow the prescribed limit to be exceeded.
According to EM Najeeb, senior vice-president of the Indian Association of Travel Agents (IATO), stable airfares will encourage domestic travelers to fly to the country for various purposes, including domestic tourism. The unrealistic increase in domestic routes will prompt tourists to look for other options, including overseas packages, depriving the local economy of the benefits that should have flowed from the sector, Mr Najeeb said.
Published – 25 February 2026 22:00 IST
