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Flying out from Madurai, Coimbatore and nine other cities is set to become costlier. The Airports Authority of India has sought Government's nod to impose user development fee (UDF) on passengers for the airports in these cities.
“We have proposed a levy of Rs 400 for every domestic passenger and Rs 750 for every international passenger flying out from these 11 airports. The proposal was sent to the Civil Aviation ministry on Tuesday,” a person in the know told Business Line.
UDF is a revenue enhancing measure to ensure economic viability of airport operations. Airport developers impose such fees after undertaking modernisation work.
Out of 11 airports, UDF for Ranchi and Raipur will be subject to completion of the modernisation work. Work here is likely to be completed by March next year. The Airports Authority of India has completed modernisation works in 26 airports, out of which UDF is being charged from passengers departing from nine airports.
The Authority is also working on a proposal for UDF in Chennai and Kolkata airports. These airports are also being modernised and are expected to be completed within the next few months. “The Authority will send proposal to the Airport Economic Regulatory Authority (AERA),” he said. However, nothing has been finalised in terms of the amount to be levied at these two airports.
At present,12 airports including Delhi, Hyderabad, and Bangalore charge UDF. Though Mumbai was charging a development fee, it had to suspend it after a court order. The fee ranges from Rs 100 to Rs 430 for domestic passengers. For any airport handling more than1.5 million passengers, the proposal to levy UDF needs to be approved by the AERA. For all other airports, the Civil Aviation Ministry gives the nod on a case to case basis.
The Delhi International Airport was allowed to levy an airport development fee (ADF) even before the completion of the greenfield or modernisation projects. This is called pre-funding mechanism for the project. This too is approved by AERA in case of major airports in case of their inability to finance the project through other options. For others, the Civil Aviation Ministry is the granting authority.
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