Bangalore int'l airport heading for bankruptcy

Bangalore's brand new airport might be on the road to bankruptcy. The airport's promoters have appealed to the Civil Aviation Ministry to allow them charge domestic passengers a user development fee.
It does seem like the Semiens, L&T, and Zurich airports consortium that built the Bengaluru International Airport is headed for trouble. BIAL said it would be bankrupt in a few years if it were not allowed to charge domestic passengers a user development fee every time they fly out of Bangalore.
It has proposed to charge Rs 675 per passenger on domestic routes. The concession agreement between BIAL and the Government of India allows the consortium to charge a user development fee. The airport already charges international passengers Rs 1,000 per flight. BIAL is now awaiting the Civil Aviation Ministry's nod on the amount it can charge as user development fee for domestic passengers.
BIAL officials said they needs to recover the Rs 2,500 crore invested in the airport in the first five years. The user development fee is an integral part of their recovery plan. The airport is also under tremendous pressure to expand capacity and the money raised from the fee surcharge will be pumped back into the project.
14/08/08 Faye D'Souza/CNBC-TV18/Moneycontrol.com

To Read the News in full at Source, Click the Headline

Categories: Airports Aug 2008