The Federation of Indian Airlines (FIA) has written to the Indian ministry of civil aviation, opposing government directions that require carriers to allocate a minimum 60% of seats for 'free' selection.
The airlines' body has argued that this will have 'unintended and adverse consequences' for the aviation sector, as seat-selection fees are a 'legitimate component of airline revenue'.
Imposing a uniform restriction on ancillary revenue undermines commercial flexibility and interferes with market-driven pricing mechanisms, the federation said.
This could lead to an overall rise in fares, as airlines will be forced to recover lost revenues through increases in fares.
The federation has also alleged that the ministry's directive raises concerns regarding regulatory overreach into commercial aspects of airline operations.
The airlines' federation has underlined a reply of the ministry to a question in the Lok Sabha, which stated that airfares are not regulated by the Government, and airlines are free to determine fares in accordance with market conditions.
The federation has proposed that the mandate to the DGCA be withdrawn and the currently prevailing rules continue.
