May lead to spike in fares: Airlines oppose 60% free seat rule

The battle for the “middle seat” has moved from the cabin to the courtroom. As of Saturday, March 21, 2026, India’s major carriers are in open revolt against a government attempt to eliminate seat-selection fees for the majority of passengers.

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The “Unbundling” Conflict

For years, low-cost carriers (LCCs) like IndiGo and SpiceJet have operated on an “unbundled” model. You pay a low base fare for the seat, and then pay extra for “ancillaries” like meals, extra baggage, and preferred seating (window, aisle, or extra legroom).

• The New Rule: 60% of the plane must be available for $0$ extra charge during booking.

• The Airline Stance: Ancillary revenue accounts for up to 15-20% of an LCC’s total income. Removing this “forced” airlines to hike the base ticket price across the board.

How Fares Might Change

Aviation analysts suggest that if the 60% rule stays, we could see a “Flat Rate Hike.” To recover the lost ₹200–₹1,500 typically charged for seat selection, airlines may simply add a “Regulatory Recovery Fee” of ₹300–₹500 to every single ticket sold in India. This means even those who didn’t care where they sat will now pay more.

The FIA’s Legal Argument

The FIA’s letter is blunt: the government is overstepping. They argue that the Directorate General of Civil Aviation (DGCA) does not have the legal mandate to fix prices for commercial services.

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“DGCA does not have the authority to fix or cap charges for unbundled services,” the FIA stated, pointing to a precedent that treats seat selection as an optional “value-added service” rather than a right.

Reality Check

The timing of this directive is curious. With global oil prices at $105/bbl due to the ongoing West Asia conflict, airlines are already struggling with high Aviation Turbine Fuel (ATF) costs. Adding a revenue cap now could push smaller players toward financial instability. However, the government’s move is likely a response to growing public outcry over “predatory” seat pricing, where sometimes every seat on a plane appeared to have a fee attached.

The Loopholes

The government claims this is for “passenger benefit.” In fact, this is a “Pricing Loophole”—by mandating 60% free seats, the government ensures a “headline” win, but it cannot stop airlines from increasing the price of the remaining 40% (the “Prime Seats”) to astronomical levels. Still, the “Booking Loophole” remains; airlines might comply by making 60% of seats free, but only releasing them for selection 48 hours before the flight, forcing early bookers to still pay for the “Premium” 40%.

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What This Means for You

If you are planning a trip, prepare for “Opaque Pricing.” First, realize that the “Total Cost to Fly” will likely remain the same or increase; you just won’t see the “Seat Fee” broken out on your receipt.

Then, if you are a budget traveler, understand that “Service Differentiation” will fade. Airlines may stop offering certain perks to standard flyers to cut costs. Finally, understand that this rule is not yet set in stone. If the FIA successfully gets a stay order from the High Court, the current “pay-per-seat” system will continue.

What’s Next

Expect a meeting between the Civil Aviation Ministry and FIA by Tuesday, March 24. Then, look for new “Summer Schedule” fare filings from airlines, which will reveal if base prices are already trending upward. Finally, expect the DGCA to issue a “Clarification Note” on whether the 60% free seats must be available at the time of booking or only during web check-in.

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End….

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