Hyd airport withdraws fee increase application

By : Mihir Mishra
Last Updated: Thu, Mar 11, 2010 20:00 hrs

The airport levies Rs 1,000 for each international passenger.

Rajiv Gandhi International Airport in Hyderabad has withdrawn a request to increase user development fees (UDF) with the Airport Economic Regulatory Authority (AERA).

"The Hyderabad airport has withdrawn its request for an increase in the UDF charged at the airport and will apply once we notify a revenue model to be followed by the airports," said a senior AERA official, who did not want to be identified.

The proposal was to increase UDF on embarking domestic passengers to Rs 500 and Rs 1,300 for international passengers. Currently, it levies Rs 375 and Rs 1,000 for domestic and international passengers, respectively.

The airport company, with a capacity to handle 12 million passengers per annum, applied for an increase in UDF because the passenger footfall, instead of rising as expected, had declined. While 2007 (at the old airport, since closed)recorded a figure of 6.70 million and 2008 of 6.53 million, it was 6.33 million in 2009.

Hyderabad airport is 63 per cent owned by Bangalore-based infrastructure company GMR. The rest is shared among Malaysian Airport Holding (11 per cent), Government of Andhra Pradesh (13 per cent) and Airports Authority of India (13 per cent).

Meanwhile, AERA has selected hybrid- or single-till model for airports across the country, which is followed by Heathrow and Gatwick airports in UK. In this model, all principal airport activities including aeronautical (landing, parking and ground handling charges) and non-aeronautical (duty-free shops, hotel, restaurant, among others) are taken into account to determine the level of airport charges.

Analysts also feel the hybrid model would be good for India until earnings from commercial operations at the airports across the country increases. This, they believe, is going to take some time.

The hybrid model would decrease the burden on commuters. As of now, departing passengers at Hyderabad, Bangalore and Jaipur airports pay UDF. Airports in Delhi and Mumbai charge airport development fees from every departing passenger.

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