Chennai: The Chennai airport will be charging just Rs 69 per passenger as user development fee (UDF) from May 1. This is a steep reduction from the present Rs 166 for domestic passengers and Rs 667 for international passengers. However, experts say the airlines may not immediately pass on the benefit by lowering the fares due to increasing fuel prices.
The Airports Authority of India (AAI) has reduced fees in wake of the Airports Economic Regulatory Authority of India passing an order saying that the user development fee is reduced from May 1, 2018.
Once the order is implemented, it will cause the AAI a revenue loss of Rs 200 crore. Interestingly, on April 18, 2017, the AAI proposed to increase the user development fee to Rs 200 per domestic passenger and Rs 400 per international passenger while the AERA had suggested a total waiver of the user development fee in its consultation paper released in February.
The move to charge Rs 69 from both international and domestic passengers was taken after the AAI submitted that it requires an additional grant of Rs 300 crore to meet its operational requirements.Interestingly, the International Air Transport Association (IATA) has suggested that UDF should be removed as pre-funding of infrastructure investment by users. “Abusing airport monopoly by making consumers pre-fund investment is costlier than funding through financial markets,” IATA had observed.
Meanwhile, domestic and international landing charges have been reduced by approximately 89 per cent. This would also impact the revenue collected from landing charge which was Rs 305.6 crore last year. Now it will fall to Rs 59.7 crore this financial year.The move has been welcomed by the aviation industry which suggested eliminating unjustified differentials in landing charges between domestic and international flights.
24/04/18 C Shivakumar/New Indian Express
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The Airports Authority of India (AAI) has reduced fees in wake of the Airports Economic Regulatory Authority of India passing an order saying that the user development fee is reduced from May 1, 2018.
Once the order is implemented, it will cause the AAI a revenue loss of Rs 200 crore. Interestingly, on April 18, 2017, the AAI proposed to increase the user development fee to Rs 200 per domestic passenger and Rs 400 per international passenger while the AERA had suggested a total waiver of the user development fee in its consultation paper released in February.
The move to charge Rs 69 from both international and domestic passengers was taken after the AAI submitted that it requires an additional grant of Rs 300 crore to meet its operational requirements.Interestingly, the International Air Transport Association (IATA) has suggested that UDF should be removed as pre-funding of infrastructure investment by users. “Abusing airport monopoly by making consumers pre-fund investment is costlier than funding through financial markets,” IATA had observed.
Meanwhile, domestic and international landing charges have been reduced by approximately 89 per cent. This would also impact the revenue collected from landing charge which was Rs 305.6 crore last year. Now it will fall to Rs 59.7 crore this financial year.The move has been welcomed by the aviation industry which suggested eliminating unjustified differentials in landing charges between domestic and international flights.
24/04/18 C Shivakumar/New Indian Express
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