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Air fares to go up in India after Govt imposes levy

The levy amount would be imposed for an entire flight and the airfares would rise as airlines are expected to pass on the burden to pasengers

Domestic airfares are set to rise in India with the government deciding to impose levy up to Rs 8,500 per flight on major routes to fund the ambitious regional connectivity scheme.

The levy amount would be imposed for an entire flight and the airfares would rise as airlines are expected to pass on the burden to passengers.

“The levy for an up to 1,000 kilometre length of scheduled flight will be Rs 7,500 per flight, Rs 8,000 for a 1,000 to 1,500 kilometre flight and Rs 8,500 for flights above 1,500 kilometre,” Civil Aviation Secretary RN Choubey said.

Termed as Ude Desh ka Aam Naagrik (UDAN), the scheme is aimed to connect small cities by air as well as make flying more affordable for the masses, officials said.

The government would impose a levy on every departure on major air routes such as the national capital, Mumbai, Chennai, Hyderabad, Bengaluru and Kolkata, media reports said.

The government would be creating the Regional Connectivity Fund (RCF) for this scheme and expected to have Rs 400 crore for RCF with this levy.

“In addition to this, another 20% (funding) will come from state governments. We are roughly looking at around Rs 500 crore per year available in the kitty,” Choubey added.

The funding is being provided since the charges of half of the seats operated in a   flight under UDAN would be capped at Rs 2,500 for one-hour and the cap would be applicable for distance of 476-500 kilometres, reports revealed.

The limit of RCS airfare is expected to vary from Rs 1,420 to Rs 3,500 for fixed-wing aircraft, while for helicopters, half-an-hour ride under would cost Rs 2,500 and for over one- hour duration, the cap would be Rs 5,000.

 

 

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