CCI chief Chawla backs overcharging by airlines
17 Aug 2015 5:47 AM IST
Capping of airfares will violate competition norms as it stifles the movement of market forces, fair trade watchdog CCI’s chief Ashok Chawla has said amid rising calls to curb exorbitant pricing of air tickets.
Terming that such a move would be “antithetical” to the philosophy of competition as well as deregulation, Chawla stressed that market forces should be allowed to operate.
His assertion comes against the backdrop of increasing demand from various quarters, including Parliamentarians, to put in a mechanism to contain steep fluctuations in airfares.
The Competition Commission of India (CCI) Chairman said capping of airfares has no place on the competition side and the prices have to be determined by the market forces as the sector is deregulated.
“Capping (of airfare) is antithetical to the policy of deregulation as well as to the whole philosophy of competition and what market determines,” Chawla said in an interview.
He observed that when something is deregulated and the market forces are supposed to determine it, then capping of pricing is not in sync with the philosophy of deregulation. “So deregulation is where you allow market forces to operate and if you allow market forces to operate and you sought of stifle the market forces saying you will not allow this beyond a level, then actually you are not allowing the full play of market forces,” the CCI chief said.
Currently, the CCI is probing whether there is <g data-gr-id="33">cartelisation</g> among carriers in fixing <g data-gr-id="28">price</g> of air tickets. Interestingly, the watchdog had looked into the matter on three previous occasions as well but did not find any evidence of fair trade norm violations.
About the ongoing investigation, Chawla said it would take a couple of months.
In May, a group of Parliamentarians led <g data-gr-id="37">by by</g> BJP leader Kirit <g data-gr-id="38">Somaiya,</g> had met Chawla and lodged a fresh complaint against carriers on airfares. While there has been no official word from the government on capping of airfares, Union Minister Mahesh Sharma has hinted in recent times that ways were being looked at to curb predatory pricing of air tickets.
“Even if we talk (about the issue) in Parliament, out of the 543 Parliamentarians, I am sure at least 500 would say that there should be a capping,” Sharma, who is the Minister of State for Civil Aviation, had said last month.
However, the Ministry has also been <g data-gr-id="35">emphasising</g> that airfares are not regulated by the government as they are determined by the interplay of market forces.
Avoid excessive <g data-gr-id="80">duty free</g> items on board: DGCA
Aviation regulator DGCA has asked airlines to stop allowing excessive <g data-gr-id="79">duty free</g> material and extra crew baggage on board, as part of its efforts to ensure efficient fuel management during flights. Besides, the carriers are now required to avoid “unwanted extra weight” in order to curb additional fuel burn. The latest directive is part of a detailed circular on ‘Climate Change Initiatives and Local Air Quality Monitoring in Civil Aviation’. According to the Directorate General of Civil Aviation (DGCA), carriers should avoid additional fuel burn on account of unwanted extra weight.
“Carriage of items like old magazines and newspapers, excess duty free material, extra water in the tanks not required for the flight, pillows and blankets, excessive crew baggage, extra airline magazines, empty baggage and cargo containers, etc. shall be avoided on board the aircraft.
“Moisture accumulation in the aircraft insulation, accumulation of dirt both inside and outside the aircraft shall also be avoided,” it said in a recent circular. Whenever practicable, the flight crew should follow an uninterrupted descent profile from cruise altitude without the use of thrust or speed brakes until reaching the final approach stabilisation altitude.
“The flight crew shall also adhere to the computed descent speeds and monitor the descent profile for any adjustments, if any,” it added. Among others, foreign-registered airlines operating to/from India are exempted from these requirements.
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