Athira Sethu
Kochi, 23 March 2026
Shares in aviation-related companies like IndiGo (operated by InterGlobe Aviation) and SpiceJet are likely to be in focus on Monday, i.e., March 23. Why so? Because the government has announced its plan to remove the temporary restrictions it had placed last December on domestic airfare prices. These restrictions had to be put in place due to severe disruptions in flight operations, particularly those operated by IndiGo.
What are airfare caps?
Airfare caps are restrictions placed by the government on the prices charged by an airline for flying on a particular route. They are set in a range with a floor and a ceiling to ensure that ticket prices are not excessively high. The temporary restrictions were put in place due to disruptions caused by IndiGo’s flight operations in December 2025.
Why are airfare caps being removed?
The government has announced its plan to remove these restrictions from March 23 because things are back to normal in the aviation industry. In a statement released to this effect by the Civil Aviation Ministry, it was stated that flight operations are back to normal with capacity restored.
However, the ministry added that airlines are expected to ensure that they are providing reasonable fares to passengers. In addition to this, the government added that it would keep an eye on ticket prices in real-time and take action if airlines take advantage of any situation to hike ticket prices.
Challenges airlines are facing:
Despite the removal of these restrictions, the airlines are facing several challenges. West Asia is becoming a challenging region for airlines due to the conflict in this region. The conflict in West Asia involves several prominent countries like the US, Israel, and Iran.
Recently, the Directorate General of Civil Aviation (DGCA) asked airlines to avoid flying in the airspaces of nine countries in West Asia, including Iran, Israel, and Iraq, till at least March 28. This is due to the conflict in West Asia.
Besides this, airlines are also facing challenges in terms of increased fuel prices and insurance premiums. These are increasing the difficulties for airlines to fly in West Asia due to increased costs.
What does the future hold?
As the airline industry continues to face these challenges, the government has been very clear that any unjustified rise in prices during periods of high demand or when there are disturbances will be taken seriously. The ministry will be on full alert to make sure that the interests of the passengers are kept at heart and that the airlines are not being unreasonable in their pricing of air tickets.
