Air India announces 3% agent commission

Following private airlines’ move, Air India, the public sector carrier on Tuesday announced to provide a three percent commission to travel agents.

This move of AI came in the wake of two private sector carriers’- Jet airlines and Kingfisher- announcement of paying three percent commission on both basic fares and fuel surcharge instead of a five percent commission on basic fares, which the duo had announced on December 09.

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Now, AI official has said that as Jet and Kingfisher has already made an announcement of paying three percent commission on basic fares and fuel charges except government taxes and congestion fee, AI could not live in isolation.

Over 2,500 travel agents in India will be benefited by this move as AI has the maximum number of travel agents.

These three major airlines had stopped agency commission to travel agents from November 01 and denied any further revision.

However, travel agents cited it a meager revision as sometimes the agents have to bear losses in terms of higher value tickets including international First and Business Class tickets.

Singapore Airlines is another carrier which has stopped the agent commission. When asked about this step of AI, the officials of Singapore Airlines denied making any comment.

Commenting upon the airfares, Kingfisher officials stated it is not going to reduce the airfares until the government brings Air Turbine Fuel (ATF) under ‘declared goods’.

After bringing ATF under ‘declared goods’, it would then attract a unified 4% tax in all states while at present, states charge 4%-32% of sales tax on ATF, which cost one third of the operational cost.

However, Oil Marketing Companies (OMCs) have done seven rounds of reduction from September and the price of ATF has come down from the average cost of Rs.71,000 per kilolitre to an average of nearby Rs 33,000 per kilolitre at present.

On the other hand, despite steep fall in the price of crude oil from over $147 to below $40 at international market, a petroleum ministry official on Monday indicated that the prices of fuel in India was unlikely to go down before February.