Ministry of Transportation's Response to Proposal for Upper Limit on Airfare Prices
The Ministry of Transportation will consider various aspects regarding the provisions for the upper limit on airfare prices. However, no decision has been made yet, even though the Indonesia National Air Carriers Association (INACA) has proposed a 15 per cent increase in fares due to considerations of the surge in aviation fuel (avtur) prices and the weakening rupiah exchange rate against the dollar.
Director General of Air Transportation at the Ministry of Transportation, Lukman F. Laisa, stated that the government understands the dynamics faced by the national aviation industry as a result of developments in the global geopolitical situation, which affects the rise in avtur prices, exchange rate fluctuations, and airline operational costs.
“We reaffirm that every policy taken will prioritise a balance between the sustainability of the aviation industry and consumer protection, so that air transport services remain maintained in terms of safety, security, affordability, and national connectivity,” he said in a written statement on Wednesday, 25 March 2026.
Previously, INACA requested an increase in the fuel surcharge and the upper limit on fares for jet and propeller aircraft by 15 per cent. This is because 70 per cent of airline operations use US dollars, while revenue comes from rupiah.
However, the conflict between the United States and Israel with Iran has heated up since 28 February 2026, causing crude oil prices to continue skyrocketing. Supplies from the Middle East region are disrupted due to Iran’s blockade of the Strait of Hormuz.
Lukman said the Ministry of Transportation continues to coordinate with all stakeholders, including airlines, airport operators, avtur providers, and other related agencies, to monitor developments in avtur prices and their impact on flight operations.
“In principle, the government considers various aspects, including the economic condition of airlines, the purchasing power of the public, the sustainability of the aviation industry, as well as aspects of safety, security, and service,” he stated.
In addition to avtur prices, INACA is also considering the certainty of aircraft spare parts procurement that are currently under maintenance (AOG parts). Currently, the supply chain is also disrupted, so the delivery of spare parts, which previously took only 2-3 days, now takes 7-10 days with additional increased shipping costs.