Up to Rs1,500 flight ticket hike likely as airlines regain pricing freedom

Domestic air travel is set to become more expensive across India starting March 23, after the government lifted fare caps, allowing airlines to price tickets freely in line with market conditions and rising costs. The move by theMinistry of Civil Aviationmarks a return to full deregulation, ending temporary price bands that were introduced to stabilise fares during operational disruptions. With these limits gone, airlines are now expected to gradually increase ticket prices, particularly on high-demand routes.

Industry estimates suggest that passengers could see fare hikes ranging from ₹200 to ₹1,500 per ticket, depending on the airline, route and booking window. Sources from IndiGo airline say that it is expected to lead the trend, with fares likely rising between ₹300 and ₹1,200. The airline has already introduced fuel surcharges, and prices on busy metro routes like Delhi–Mumbai and Mumbai–Bengaluru could see sharper increases of up to ₹1,500, especially during peak hours.

Full-service carrierAir Indiais also expected to raise fares in the ₹400 to ₹1,500 range. While economy class tickets may see moderate increases, last-minute bookings and business travel segments could witness steeper spikes due to higher demand and premium positioning. Among low-cost carriers,Air India Expressis likely to keep hikes relatively modest, in the range of ₹300 to ₹900, at least initially. Similarly,SpiceJetmay limit fare increases to ₹200–₹800.

Newer entrantAkasa Airis expected to follow a balanced approach, with estimated fare hikes between ₹300 and ₹1,000, aligning with broader market trends while maintaining its growth strategy. Route-wise, short-haul flights under an hour may see smaller increases of ₹200 to ₹500, while metro routes of one to two hours could witness hikes between ₹500 and ₹1,200. However, the biggest impact is likely on last-minute bookings, where fares could surge by ₹1,000 to ₹2,500, particularly during weekends and holiday travel periods.

The fare hikes are largely driven by rising aviation turbine fuel (ATF) costs, which account for a significant portion of airline expenses, along with ongoing geopolitical tensions impacting global oil prices. While the government has cautioned airlines against excessive pricing, fares are now expected to fluctuate more sharply based on demand, marking a shift towards a fully market-driven pricing regime for domestic air travel.