Fare hike will prune airline losses but slow down traffic growth: experts

On Friday the govt hiked minimum and maximum fare slabs by 12.5%

The government's move to hike minimum and maximum fare slabs by an average 12.5 per cent will help airlines to narrow their losses, but will delay the recovery of air traffic to pre-Covid levels, aviation experts have said.

On Friday, the civil aviation ministry raised the floor and ceiling prices which airlines can charge in a 30-day cycle. There is no cap on fares sold beyond 30 days and airlines are free to charge their own prices.

Airlines have also been allowed to deploy 72.5 per cent of their capacity–an increase of 7.5 per cent. With the latest order, minimum