New Delhi: Has the privatisation of Delhi and Mumbai airports helped improve airport infrastructure in the country or has it encouraged private operators to skim profits while raising costs for flyers ? There have been voices supporting these opposing points of view, depending on who is making the argument. But now, the Government finds itself in a pickle.
The airport regulator AERA wants to reduce aeronautical charges (levies airlines pay for landing, parking etc) at Delhi airport by a steep 78%. If the Government allows AERA to do this, it is working against itself since it remains a stakeholder in the airport project. But If the Government allows the regulator to maintain aeronautical charges, there could be allegations of hurting airlines' bottomlines.
State run Airports Authority of India (AAI) holds 26% equity in Delhi International Airport Ltd (DIAL) while it earns 46% revenue share from the airport. GMR, Fraport and Malaysia Airport Holdings are the other three stake holders with 54%, 10% and 10% stake respectively. AERA's push for reduced aeronautical charges at Delhi will be a boon for airlines but will shave off Rs 900 crore straightaway from AAI's topline. Revenues earned from Delhi airport account for almost a third of the total revenues AAI earns from all airports across the country, so a steep reduction in charges airlines will pay at Delhi has a huge impact on AAI's topline. Any such reduction will also obviously impact its bottomline.
14/04/15 Sindhu Bhattacharya/FirstPost
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The airport regulator AERA wants to reduce aeronautical charges (levies airlines pay for landing, parking etc) at Delhi airport by a steep 78%. If the Government allows AERA to do this, it is working against itself since it remains a stakeholder in the airport project. But If the Government allows the regulator to maintain aeronautical charges, there could be allegations of hurting airlines' bottomlines.
State run Airports Authority of India (AAI) holds 26% equity in Delhi International Airport Ltd (DIAL) while it earns 46% revenue share from the airport. GMR, Fraport and Malaysia Airport Holdings are the other three stake holders with 54%, 10% and 10% stake respectively. AERA's push for reduced aeronautical charges at Delhi will be a boon for airlines but will shave off Rs 900 crore straightaway from AAI's topline. Revenues earned from Delhi airport account for almost a third of the total revenues AAI earns from all airports across the country, so a steep reduction in charges airlines will pay at Delhi has a huge impact on AAI's topline. Any such reduction will also obviously impact its bottomline.
14/04/15 Sindhu Bhattacharya/FirstPost
