The Centre will have the power to intervene in airline ticket prices during extraordinary situations under a new set of aviation rules notified by the government. The framework also introduces stricter transparency requirements, making it mandatory for airlines to provide passengers with a detailed breakdown of fares, taxes, fees, cancellation charges and refund conditions.
The Bharatiya Vayuyan Niyam, 2026, will come into effect on January 1, 2027, replacing the Aircraft Rules, 1937, which have governed India’s civil aviation sector for nearly nine decades. The rules were notified by the Ministry of Civil Aviation and published in the Gazette of India on October 31.
The new provisions come amid concerns over rising airfares, particularly during periods of high demand, flight disruptions and limited seat availability. Under Rule 192, the Central government can issue written directions to airlines if it believes an extraordinary situation has arisen and intervention is necessary in the public interest.
The government can also direct an airline to revise its tariffs for a specified period. Any such direction must be proportionate to the circumstances and remain effective only for the period mentioned in the order.
However, the rules do not define what constitutes an extraordinary situation or specify a particular price threshold that would trigger government intervention. This leaves the Centre with the responsibility of assessing individual circumstances before deciding whether action is required.
Importantly, the new framework does not introduce a permanent cap on airline ticket prices. Carriers will continue to determine fares under normal market conditions without seeking prior government approval for every price revision. The intervention provision is intended to provide the government with an additional mechanism to respond to exceptional circumstances rather than regulate everyday ticket pricing.
The rules also require airlines operating scheduled services to determine fares based on factors including their operating costs. They must submit tariff details to the Directorate General of Civil Aviation (DGCA) in the format and at intervals specified by the regulator. The DGCA will continue to monitor airline tariffs.
A significant part of the new framework focuses on making airfare information more accessible to passengers. Airlines will have to publish their tariffs on their official websites and other digital platforms. The total amount payable by a passenger must be clearly displayed during the booking process and on the ticket issued after payment.
The fare breakdown must separately mention the base fare, government taxes, fees, cancellation charges, refund conditions and other applicable charges. The rules also require a distinction between taxes collected on behalf of the government and fees charged for services or facilities provided by airlines.
The disclosure requirements are expected to help travellers understand the actual cost of a flight before making a booking. Passengers will also be able to compare fares more easily and check cancellation and refund conditions without having to search through different sections of an airline’s website.
The provisions apply to Indian airlines operating scheduled services as well as foreign airlines operating scheduled flights to, from or across India. This extends the transparency requirements across a wider range of carriers serving the Indian aviation market.
The new framework also changes the allocation of powers relating to airline fare intervention. Under Rule 135(4) of the earlier Aircraft Rules, 1937, the DGCA could issue directions in cases involving excessive tariffs, predatory pricing or oligopolistic practices.
Under the new Rule 192, the Central government has the authority to issue written directions when it considers intervention necessary during an extraordinary situation. The new provision does not specifically reproduce the earlier rule’s list of grounds, including excessive or predatory pricing. The DGCA, however, retains its responsibility for monitoring tariffs and receiving pricing information from airlines.
The move comes as airfares remain a concern for passengers and policymakers. Ticket prices can vary significantly depending on booking time, travel dates, seat availability and demand. Travellers booking at short notice, particularly during holidays or periods of flight disruption, often face substantially higher fares.
The issue was also discussed by a parliamentary panel on November 2, which questioned representatives of IndiGo and Air India over rising ticket prices. The airlines cited elevated aviation turbine fuel costs and longer flying routes following the closure of Pakistan’s airspace after Operation Sindoor as factors adding to their operating expenses.
India deregulated airline fare fixation in 1994, allowing carriers to determine ticket prices according to market conditions. Airlines have since used different pricing categories based on demand, operating costs and the time of booking. The new rules retain this market-based system while giving the government powers to intervene in exceptional cases.
The Bharatiya Vayuyan Niyam, 2026, forms part of a broader overhaul of India’s aviation regulatory framework. It has been framed under the Bharatiya Vayuyan Adhiniyam, 2024, which replaced the Aircraft Act, 1934. The new rules cover several areas, including aircraft registration, manufacturing, safety certification, maintenance, flight operations, personnel licensing and airport operations.
For passengers, the changes promise greater transparency in ticket pricing and the possibility of government intervention during extraordinary fare increases. However, they do not guarantee cheaper flights or prevent airlines from revising fares under normal market conditions.
The effectiveness of the new framework will depend on how the government identifies extraordinary situations and exercises its powers. From January 1, 2027, the rules will introduce a new system of airfare oversight while replacing the colonial-era regulations that have governed India’s civil aviation sector.