Flying from Delhi, Mumbai may be costlier

New Delhi: Airfares are down but people flying out of Delhi and Mumbai should get ready to pay an additional fee to fund the airport development projects that have hit a revenue roadblock. The GVK-backed Mumbai International Airport (Pvt) Ltd (MIAL) has cited a shortfall of about Rs 2,000 crore in the Rs 9,800-crore development programme and sought the aviation ministry's nod to levy an airport development fee (ADF) to bridge this gap.
The group is seeking an identical Rs 200-300 and Rs 1,000 as ADF from each outgoing domestic and international passenger respectively, that GMR-backed Delhi International Airport (Pvt) Ltd (DIAL) has already sought. DIAl has told the aviation ministry that its funds would dry up in just over a month and that the project would suffer unless some funding arrangement either ADF or soft long-term loan is made at the earliest.
"We too had expected to raise about Rs 2,000 from our realty projects. Till that happened, we were planning to raise loans. In the current circumstances, however, banks are either not willing to give loans or cost of their capital is prohibitive. Since Delhi and Mumbai are on equal footing, we have sought the levy of a user fee that the capital's airport gets to bridge our gap," said a senior MIAL official.
MIAL has communicated to the government that its lead banker, IDBI, is reluctant to give more loan to cover the revenue gap. MIAL MD G V Sanjay Reddy confirmed that the project is facing a revenue crunch in the current situation and has sought the levy of a user fee to cover the gap.
05/01/09 Saurabh Sinha/Times of India

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Categories: Airports Jan 2009