AI top brass working on fare reduction

In a bid to boost the air traffic growth rate, Air India's top brass has started working on slashing the carrier's fares following considerable reduction in jet fuel prices.     

"We are working on it, but at this moment, we cannot specify the quantum or from when this (reduction in fares) will be effective," a top airline official, who preferred anonymity, told.

Sources said the cut in Air India's fares on the domestic sector could range between 10 and 12%, but the official refused to confirm.     

Steps could also be taken to slash fuel surcharge and tinker with the congestion surcharge, the sources said, adding that the fare reduction could be made effective in December itself.

Renewing his pitch for making air travel cheaper, Civil Aviation Minister Praful Patel had last week asked all the carriers to slash fares in response to the government's support to the aviation industry to meet the financial crisis.     

On its part, the government has asked oil marketing PSUs to extend credit period and allow airlines to clear their dues amounting to about Rs 3,000 cr by March next year.

It has also abolished the five per cent customs duty on ATF, even as the jet fuel prices were brought down considerably.     

Regarding Air India, Patel had said, "We have never dictated what Air India should do in terms of pricing or routes, or capacity.

But AI, as a responsible government carrier, will also understand that if the oil prices are coming down, so should the fares."