In a move that could make flying from Delhi and Mumbai airport cheaper from January 1, the board of Airports Authority of India (AAI) has approved a proposal to pump in an additional equity of Rs 293 crore in Mumbai airport and Rs 115 crore in Delhi airport.

A senior AAI official said the Board decision would be subject to the Airports Economic Regulatory Authority (AERA) agreeing to abolish Airport Development Fee (ADF) from January 1, 2013. AAI will soon write to AERA, informing it about the Board’s decision and seeking removal of ADF.

Earlier this month, the Civil Aviation Ministry had directed the two metro airports to do away with ADF. Instead, AAI was asked to pump in more equity in Delhi and Mumbai airports.

Even after AAI pumps in additional funds into the two joint venture airport projects, its equity will remain at the current 26 per cent, sources said.

ADF was levied at the two airports, as AAI had taken the plea that it was not in a position to contribute more equity in view of its critical financial condition. Since 2006-07 till date, AAI has received over Rs 5,100 crore as revenue share from the two airports.

At the moment, a passenger taking a domestic flight from Delhi pays Rs 200, while a passenger boarding an international flight pays Rs 1,300. In Mumbai, the charges for a domestic passenger are Rs 100 and Rs 600 for an international passenger.

The state-owned airport operator is a joint venture partner in the new companies that are managing the modernisation of the two airports.

Passengers will, however, continue to pay User Development Fee for flying through the two airports, which is levied on both departing and arriving passengers. In Delhi, UDF varies from Rs 200 to Rs 1,100.

While ADF is a facility to meet funding gap in the project, UDF is a charge that the airport operator collects from airlines, passengers and others for using the airport.

> ashwini.phadnis@thehindu.co.in

Related Topics