Government holds talks on sustainability of airlines over fare war

In his maiden meeting with all stakeholders of India's civil aviation, union minister Hardeep Singh Puri held discussions on various issues including sustainability of airlines in view of consistent fare wars, people aware of the development said.

While airlines raised concerns about the sustainability of operations due to predatory pricing on several routes, the government also asked the airlines to keep the sustainability of operations in mind while setting fares, sources said.

A senior official added that the government is looking into the issue, “We are looking into it."

"It can't be a situation of one airline shutting every five years. Fares need to be competitive but also sustainable for the industry," another official present in the meeting said.

While Jet Airways and Kingfisher Airlines had several issues leading to the halt of operations, one of the common problems was that of pricing of fares.

The meeting was attended by airlines, airports and companies involved in maintenance, repair and overhaul.

In the meeting, discussions were also held on the allocation of Jet Airways slots and traffic rights. The ministry has currently allotted several of its slots and traffic rights to other carriers till December.

In addition, the stakeholders also discussed the long-pending demand of the industry of bringing aviation turbine fuel under the GST regime, on fuel throughput charges and regarding a policy to create global hubs in India.

Companies in attendance have now been asked to submit suggestions on the issues discussed.