Average airfares across 72 domestic sectors in India rose 20.5% in June 2026 compared to March 2025, according to Directorate General of Civil Aviation (DGCA) data cited by Business Today. The Ministry of Civil Aviation points to a mix of surging jet fuel prices and capacity cuts by airlines as the primary drivers.
What happened
Aviation Turbine Fuel (ATF) — which makes up 35-40% of an airline's operating costs — has soared over 100% due to the West Asia conflict, per the Ministry's own figures. In response, domestic carriers have been trimming flight schedules as part of what the report calls "operational rationalization," effectively cutting capacity even as demand holds steady, which pushes fares up further.
The government has responded with some guardrails: the DGCA has set up a Tariff Monitoring Unit tracking 78 routes monthly to check that airlines don't exceed their declared fare ranges, and ATF prices were capped at a maximum 25% increase over the March 1, 2026 base price for the April-May period. The Ministry notes that airlines' cost structures also move with forex rates, excise duties, VAT, and aircraft lease rentals — all outside any single carrier's control.
Why it matters
For Indian travellers, a 20.5% average fare jump on domestic routes is a real hit to trip budgets, especially for routes without much competition. It also comes at a time when airlines have separately been cutting international capacity on some Southeast Asia routes, meaning fewer seats and higher prices are showing up on both domestic and regional international sectors simultaneously.
What this means for your trip
Book domestic flights further ahead than you might have a year ago — with capacity down and monitored fare ranges rather than fixed caps, last-minute fares are likely to sit closer to the top of the range airlines are permitted to charge. If your travel dates are flexible, compare fares across a wider window since price swings tied to fuel-cost pass-through can be sharper week to week than usual. Routes with multiple competing carriers will generally see gentler increases than single-operator routes, so it's worth checking connecting options via a nearby hub if a direct fare looks unusually steep.
Airfares on 72 domestic sectors rose 20.5% between March 2025 and June 2026, driven by ATF prices that "soared over 100%" amid the West Asia conflict — Ministry of Civil Aviation data via Business Today
The bottom line
Fuel costs and capacity cuts are squeezing domestic fares harder than usual right now, and the government's monitoring mechanisms are meant to prevent gouging rather than bring prices down outright. Expect fares to stay elevated through the rest of the fuel-cost cycle — plan and book earlier accordingly.
