The government has told airlines to cut down on the cancellation fee of Rs 3,000. The Centre believes it is too high and needs to be reduced soon.
The Centre will soon negotiate with airline companies and ask them to reduce the fee to a reasonable amount, The Times of India reported.
"We believe cancellation charges are on the high side and onerous for passengers. The Rs 3,000 fee is in many cases more than the price of the ticket itself," said Minister of State for Civil Aviation Jayant Sinha.
"Our UDAN (subsidised regional flying) scheme has capped fares at Rs 2,500 per hour of flying. These cancellation charges need to be brought back into balance," he added.
He has also ordered a review of the high amount charged by airlines.
This comes after SpiceJet earlier this month became the latest airline to raise its cancellation charges. The company hiked its fee to Rs 3,000 for domestic flights and Rs 3,500 for international bookings which were Rs 2,205 and Rs 2,500 respectively, before.
The price of cancelling air tickets has almost doubled in the past one year, putting customers at a larger risk of losing money for early bookings.
To add to the woes, if an air ticket is bought from an online travel portal then the customer has to pay additional charges to the portal as cancellation fee.
That often leaves the traveller with very little or no refund at all.
According to travel experts, such high charges might stop people from booking tickets early to get low fares. Many air passengers planned trips early to take advantage of lower fares.
Besides increasing the cancellation price, the airlines companies have also recently hiked charges for check-in luggage more than 15 kg on domestic flights.
"India has seen a doubling of air travellers in the last 3.5 years, a growth rate that has not been witnessed anywhere globally," said Sinha.
Despite such hikes in air travel, India is expected to become the third largest aviation market by 2025 surpassing the United Kingdom driven by a robust demand.