Air-India has announced 20-25 per cent cut in inbound fares as part of their holiday packages during the March-June lean season.

The package is aimed at tourists from Europe, the UK and the Gulf.

The package would be applicable in Europe and the UK from March 15 to June 15, and in the Gulf region from March 15 to September 30, except for June 25 to July 15, said Civil Aviation Minister Shahnawaz Hussain.

The packages would target first-time visitors to India, repeat visitors and senior citizens, he added.

Hussain was speaking at the dividend presentation ceremony of the Airports Authority of India. AAI presented a Rs 55-crore (Rs 550 million) dividend to the government for 2001-2002.

The holiday packages will include return air fare, accommodation, meals and surface transportation, in addition to local sight-seeing.

The packages include specially-negotiated hotel rates in consultation with the Federation of Hotels and Restaurants Association of India and the Hotel Association of India.

The hotels offered under the scheme include the Taj group of hotels, Le Meridien and other major chains.

Hussain said the need had been felt for sometime to develop and promote holiday packages to India in the major tourism markets abroad on the same lines as those promoted by other national carriers, such as Emirates and Sri Lankan airlines.

"To begin with, it is proposed to introduce these holiday packages in the Gulf region, Europe and the UK, which are prime tourism markets for India," he said, adding that these holiday packages would be launched in various phases, each phase focusing on a different region in the country.

Hussain said Indian Airlines would also have such holiday packages.

Air-India has in the past adopted a flexible fare policy and has increased or decreased fares as per market demands.

During the peak season of November-December, the carrier had increased fares by about 15 per cent for inbound travellers.