Ministry blocks hike in airport fees

New Delhi: It may not be easy for airport developers — private or state-owned — to incre­ase user development fees collected from air travellers on the pretext of not being able to make enough money to repay their loans or get dec­ent returns on investments.
Instead, airport develop­ers may be asked to partly cross subsidise air serv­ices ope­rations from earn­ings thr­o­ugh real estate in and around airport, hos­p­itality, retail and other services.
The civil aviation min­istry is understood to have favoured a hybrid till, as a revenue model that allows for apportioning revenue from aeronautical operati­ons and non-aeronautical services. This is against single till model that was proposed by the Airports Economic Regulatory Auth­o­r­ity (Aera) of India.
Sustainable revenue mo­d­­els are being worked out by Aera to enable companies like GMR group that deve­loped Delhi airport and GVK group that are expanding the Mumbai int­er­national air­port to make their operati­ons commer­cially viable. Even state-owned airports developer, Airports Authority of India (AAI) has been pushing for a sustainable revenue model to run metro and non-metro airports.
Three revenue models, single, hybrid and dual till are being considered by the Aera and civil aviation min­istry. In single till, the entire revenue generated from non-air business in airports is clubbed with that of air ser­vices. In the case of hyb­rid till, only a certain perc­en­tage is clubbed, where as in dual till model there is no clubbing of revenues.
13/07/10 mydigitalfc.com

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Categories: Airports Jul 2010