India’s airline industry is pushing back hard against a new government directive meant to ease the burden on passengers and the irony isn’t lost on anyone. While the Union Ministry of Civil Aviation wants carriers to offer at least 60 per cent of seats free for selection, airlines say the move could end up doing the opposite of what it intends: making flying more expensive for everyone.
Currently, airlines charge between ₹200 and ₹2,100 for seat selection, depending on factors like row position and extra legroom. The ministry issued its directive this week, asking the Directorate General of Civil Aviation (DGCA) to enforce the free-seat rule across all domestic flights. The backdrop: rising passenger complaints over charges for basic services, and fuel price pressures from West Asia tensions tied to the US-Israel-Iran conflict.
Airlines and their lobby group say it will backfire
Air India, SpiceJet, and the Federation of Indian Airlines (FIA) have all opposed the mandate. In a letter addressed to Civil Aviation Secretary Samir Kumar Sinha, the FIA didn’t mince words. It warned the rule would force carriers to recover lost revenue through higher base fares meaning even passengers who never pre-select seats would pay more.
“The financial impact of the directive on airlines will be significant, compelling airlines to recover the lost revenues through increases in fares. As a result, all passengers, including those who may not wish to preselect seats, will end up paying higher fares,” the FIA wrote.
The federation also pushed back on the characterisation of seat fees as a premium add-on. It described ancillary revenue as essential to keeping ticket prices low in the first place. “Airlines operate on thin margins and rely on ancillary revenues to offset rising operational costs, including fuel, maintenance, airport charges, etc. Imposing a uniform restriction on ancillary revenue undermines commercial flexibility and interferes with market-driven pricing mechanisms,” it noted.
The FIA also flagged a longer-term concern that the directive would “set a precedent for excessive intervention in ancillary pricing,” creating uncertainty for airlines about future regulatory constraints.
Fuel costs add another layer
Airlines have separately pointed to rising jet fuel prices as West Asia tensions disrupt supply and routes. They say they are already stretched thin operationally, making any additional revenue hit difficult to absorb without adjustments elsewhere.
The ministry’s intent was clear: give passengers fairer access to seats without paying extra. Whether that translates into genuine relief or quietly inflated base fares remains to be seen.
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