Regulator wants DIAL's non-core JVs scrapped

New Delhi: The Airports Economic Regulatory Authority (AERA) wants Delhi International Airport Ltd (DIAL), which runs airports in the capital, to scrap its 11 joint ventures for non-aeronautical operations.
The regulator wants DIAL to directly provide non-aeronautical services. In a letter sent to the civil aviation ministry, AERA has asked the ministry to ensure DIAL runs the operations by itself. Non-aeronautical revenues at Delhi airports constitute 60 per cent of total revenues. They include revenues from food outlets, duty-free operations, parking, cargo and others.
“AERA has written to us the airport operator’s revenue has come down because of the formation of joint ventures for non-aero services, where there is a revenue share. It has said the fall would lead to an increase in airport charges,” said a senior ministry official, who did not wish to be named.
For fixing charges that airlines are required to pay (like for landing and parking), the regulator takes into consideration the total aeronautical revenue and 30 per cent of the non-aeronautical revenue earned by the airport. As DIAL has most of these operations through JVs, it has to share revenue with partners. As a result, the revenue accrued in the airport operator’s account is much lower than what would have been if it ran the operations on its own.
08/09/11 Mihir Mishra/Business Standard

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

Categories: airports Sep 2011