House panel approves changes in AERA Bill

Our Bureau New Delhi | Updated on July 22, 2021

Bill aimed at encouraging development of smaller airports

The Parliamentary Standing Committee on Transport, Tourism and Culture headed by TG Venkatesh has approved the Airport’s Economic Regulatory Authority of India (Amendment) Bill. The Bill proposes to amend the definition of “major airport” so as extend its scope to determine the tariff for a group of airports. The Bill is also aimed at encouraging development of smaller airports.

Demand for more airports

The panel said it realises the huge demand for more airports in the country. “The Committee recognises the fact that it is not feasible for Airports Authority of India to meet the investment requirements to develop and maintain all the airports in the country. The Committee appreciates the inevitable need for Public Private Partnership in the development and maintenance of smaller and unprofitable airports,” the report said.

It said the proposed change in the definition of the term ‘major airport’ to include a ‘group of airports’ would, in effect, enable simultaneous development of smaller and unprofitable airports, along with the major airports, in an integrated way.

“The Committee is of the view that the Bill is needed to address the significant and continuous investment requirements in the airport infrastructure for upgradation/expansion of capacity and modernisation of processes and systems in an equitable manner to ensure that the growth in air traffic is managed efficiently. Therefore, the Committee adopts the Bill without any changes,” the report added.

Tabling the Bill during the Budget session, the then Minister of State with Independent Charge, Hardeep Singh Puri said the airports, where currently the traffic potential is low and are loss making, are not expected to attract reasonable competitive bids.

“Developing more number of airports through the public-private partnership mode would expand air connectivity to relatively remote and far-flung areas. This approach would develop not only the high traffic volume profitable airports but also the low traffic volume non-profitable airports. Therefore, the Government has decided to club or pair airports having profitable and non-profitable airports which could be offered in public-private partnership mode as a package to the prospective bidders,” Puri said in the statement of objects and reasons of the Bill.

Published on July 22, 2021

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