Advertisement
Private equity has played a significant role in shaping Indi...
In today’s real estate landscape, fitness is often treated...
In this episode of Prop Personalities, we sit down with Hars...
Luxury real estate is one of the most talked-about segments ...
Welcome to Prop Personalities by Prop News Time - a podcast ...
Private airport operators have approached the civil aviation ministry seeking regulatory support and a temporary increase in user development fees (UDF) for international passengers to offset revenue losses following a 25% reduction in landing and parking charges for domestic flights. The cut, implemented for three months by the Airports Economic Regulatory Authority (AERA) to support airlines amid rising fuel costs linked to global tensions, is expected to affect airport cash flows and financial stability. The Association of Private Airport Operators (APAO), representing major airport developers, has also requested deferral of payments to the Airports Authority of India and suggested a revision of charges post-relief period. The appeal highlights financial pressures across the aviation ecosystem, with airlines also seeking government support due to rising operational costs.
Private airport operators in India have sought regulatory intervention and financial relief from the government following a temporary reduction in landing and parking charges, stating that the measure is expected to significantly impact their revenues and operational sustainability. The representation was made earlier in the past week by the Association of Private Airport Operators to the civil aviation ministry. Advertisement
The request follows a decision by the Airports Economic Regulatory Authority to reduce landing and parking charges for all domestic flights by 25% across major airports for a three-month period. The measure was introduced to provide relief to domestic airlines facing cost pressures, particularly due to rising aviation fuel prices linked to global geopolitical developments.
Airport operators indicated that the reduction in charges is likely to affect immediate cash flows, debt servicing capabilities and overall financial stability. In its communication, the association stated that the decision could lead to revenue losses not only from aeronautical charges but also from non-aeronautical streams, which cannot be recovered at a later stage.
To mitigate the impact, the association has proposed a temporary increase in user development fees (UDF) for international passengers during the same period. It suggested that such an adjustment could help offset the loss arising from reduced landing and parking charges and avoid the need for retrospective tariff adjustments.
The association also called for a review of the pricing mechanism adopted by the regulator, indicating that a differentiated, airport-specific approach would be more appropriate than a uniform reduction across all airports. It further recommended that landing and parking charges be revised upwards after the relief period to compensate for under-recovery.
In addition, the association has requested that the government direct the Airports Authority of India to defer revenue share or per-passenger fee payments due from private operators during the relief period, without imposing interest or penalties. Such deferrals, it stated, would help maintain liquidity during the period of reduced revenue inflows.
The association’s members include major airport operators such as those backed by GMR Group and Adani Group, which manage several key airports across the country.
The developments come amid broader financial stress within the aviation sector. Earlier in the past week, airline operators, represented by the Federation of Indian Airlines, had also approached the government seeking financial support and a review of jet fuel pricing, citing rising operational costs.
Airport operators further noted that while the reduction in charges is intended to benefit passengers, there is no regulatory mechanism to ensure that airlines pass on these benefits through lower fares. As airline ticket pricing remains largely market-driven, the association indicated that the financial burden of the measure may rest primarily with airport operators.
The association has also suggested that state governments consider reducing value-added tax (VAT) on aviation turbine fuel to 5% to support the sector. The requests underline the interconnected financial challenges faced by stakeholders across the aviation value chain.
Source - PTI
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
