Govt mulls lower user fees at new private airports

The government is looking at various ways of reducing the user development fees (UDF), to be charged by the developers of greenfield airports in Bangalore and Hyderabad, even after the ad hoc period when the Ministry of Civil Aviation is expected to decide on the charges.
According to the current concession agreement, both the airports will charge user fees on their own for an ad hoc period of 120 days from the start of commercial operations. After that period, they will present the final audited project cost of the airport to the ministry.
Commercial operations in the new Hyderabad and Bangalore airports are scheduled to begin from March 16 and March 28, respectively.
“Based on that project cost we will decide what the user development charge should be, and will try to keep it as low as possible. For instance, one of the measures we might look at is enhancing the period for recovering costs from five years so that the amount of UDF levied comes down,” said a senior civil aviation ministry official.
For the first three months of operations, Hyderabad airport will charge a UDF of $25 per international passenger while the user fee on domestic passengers has been waived.
12/03/08 Business Standard

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Categories: Airports Mar 2008, New Mar 2008