The sources said the General Authority of Civil Aviation (GACA) has submitted a comprehensive study to the council in which it confirmed domestic air fares in Saudi Arabia are much less compared to other Arab countries.

"The domestic air fares in Saudi Arabia are about 50 percent less than those in other Arab countries," GACA said.

The sources said GACA was confident raising domestic air fares would contribute to attracting local and foreign investors and open up the Kingdom's airspace to additional domestic flights from private carriers.

It said the request to increase prices was made by a number of airline companies operating in the Kingdom.

The sources said raising the price cap for tickets would enable carriers to offset their operational losses, encourage international air companies to come to the Kingdom and provide air carriers with the flexibility they need to control prices and better serve their marketing policies.

GAGA had asked local and foreign investors to compete for licenses to operate domestic and international flights from the Kingdom's airports.

The sources said GACA was aiming to create a more competitive environment in the domestic flights sector, providing wider options to the passengers and boosting the sector's infrastructure.

To facilitate the competition for licenses in the Kingdom, GACA will provide a number of incentives and privileges to winning airlines, including the freedom to choose domestic service points and the airport from which they would like to operate.

According to the sources, a number of Gulf and international air companies were keen on entering the Saudi market but they wanted more flexibility over domestic air ticket prices. They asked GACA to review these prices to encourage them to come to the Kingdom.

The sources believed that once the prices of domestic air tickets were upped, many air companies would take an interest in the Saudi market.