The promoters of Delhi International Airport (DIAL) have renewed their demand for a 10% increase in aeronautical charges.
The promoters of Delhi International Airport (DIAL) have renewed their demand for a 10% increase in aeronautical charges even as their appeal on airport development fee (ADF) is still under discussion within the ministry of civil aviation.
DIAL is being developed by a consortium led by the GMR Group. It has sought higher aeronautical charges citing the concession agreement which guides the development of the country’s second-busiest airport.
A senior GMR official told DNA Money that, as per the agreement, the developers are entitled to hike charges by 10% in the third year of operation, provided the specified capital works for the first two years have been completed. “We have fulfilled the condition under which charges can be hiked; airport development is very much on track so we have sought 10% increase from the government.”
Mumbai International Airport (MIAL) has already been allowed a similar hike from January 1.
Aeronautical charges generally include landing and parking fees for aircraft, besides ground handling levies. These are decided by the state-run Airports Authority of India (AAI). All these levies have remained constant for the last seven years and only now is a change being contemplated to keep within the concession agreements the government has signed with developers of airports such as Mumbai and Delhi.
Interestingly, DIAL’s plea for hiking aeronautical charges comes close on the heels of the ministry considering its other demand — of levying ADF on domestic and international passengers to partly bridge the Rs 2,750-crore funding gap which is holding up the development of the airport.
The push for ADF comes after it became clear that because of the curious revenue sharing arrangement between GMR and AAI (which holds 26% equity in the project), any user development fee (UDF) would have become meaningless since 46% of such collections would have gone to government coffers.
This also follows several flip-flops by the government over whether commercial development of a part of the airport land can be used for raising the much-needed cash. Another option - fresh equity infusion - was also considered but then rejected by the AAI. GMR had earlier sought a levy of Rs 1,000 on international passengers and Rs 200-300 on domestic passengers.
The ADF should go a long way in helping GMR since no part of the monies so raised need to be shared with the AAI — it would be deployed entirely into capex. But higher aeronautical charges would help in only a very limited way in helping bridge the huge
funding gap.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}