DGCA has no authority to control airfares
Hyderabad: Airfares are determined by market forces and Directorate General of Civil Aviation (DGCA) has no authority to control them, a top official said.
Speaking at an event here, Bharat Bhushan, Director General of Civil Aviation also said that capacity constrains at major airports coupled with increased Air Turbine Fuel (ATF) cost is putting pressure on airline companies.
"I am afraid tariff is a function of demand and supply and unless there is extraordinary hike in fares, we will not be able to tell them that this is wrong. We have persuasive powers. But we have no authority to control fares," Bharat Bhushan told media persons on the sidelines of GMR Aviation Security Summit which concluded here yesterday.
He said the DGCA has an Aviation Tariff Monitoring cell through which it brought in a system of requiring the airlines submit their fare structure. The system was put in place when the airfares went up sharply last Diwali.
Following a large number of complaints from passengers of excessive fare that time, the aviation regulator had directed the carriers to ensure transparency in ticket-pricing by providing route and date-wise fare details.
"During the last year itself the ATF prices went up by 45 to 50 per cent. So this has a bearing on tariff," the DGCA said.
Earlier in his address at the summit, Bhushan blamed capacity constraint at major airports that is leading to wastage of fuel and impacting financial position of airlines.
"Presently capacity constraint is being experienced at major airports which is leading to wastage of fuel. An aircraft hovering for an additional half an hour due to delay in landing permission consumes about 25 to 30 per cent extra fuel thereby increasing the operational cost of the airline," he said.
Flight delays caused due to the congestion not only cause inconvenience to the passengers but also results in wastage of fuel and man hours and translate into huge additional cost, he observed.
Talking about domestic passenger growth, he said the market is expected to grow at around 10 per cent annually to reach a level of 150 to 180 million passengers by 2020. Last year the industry had crossed 50 million mark.