The Directorate General of Civil Aviation (DGCA) has set up a cell to monitor domestic airfares, a senior official of the Ministry of Civil Aviation said on Friday.

Briefing newspersons, the official said that the cell will monitor domestic airfares for at least three months to see whether there has been any unnatural upward or downward movement in fares. Monitoring airfares does not include asking airlines details of frequent sales.

After three months of monitoring, a decision on whether or not any action should be taken against an airline will be looked at, the official said. “There is no question of regulating air fares in a free market economy. But the new cell will monitor whether there is predatory pricing, whether airlines are pricing their tickets within the prescribed limits which are displayed on their website,” the official said.

The existing Aircraft Rules 1937 state that airlines are free to fix reasonable tariff having regard to all relevant factors, including the cost of operations, characteristics of services, reasonable profit and the generally prevailing tariff.

There are no immediate plans to divest the Government’s stake in Air India, the official added.

“The Government has already approved a turnaround plan which involves pumping in over ₹30,000 crore into the airline. The airline has huge accumulated losses. In the last two years it has started showing an improvement in its operations. Divestment will not be feasible… not at the moment at least,” the official said.

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