Cost of flying from the Rajiv Gandhi International Airport at Hyderabad is set to be become cheaper from April 1.
The Airports Economic Regulatory Authority has scrapped the user development fee at the airport, after considering various aspects of the airport’s operations, including the investments made by the airport operator, land allocation, traffic trends and earnings.
User development fee is a charge levied by airports on passengers to help the operator recover part of the investments made for the development of the airport and other facilities.
While both domestic and international passengers will now have to pay less for flying from the airport, the development delivers a blow to the airport operator GMR Hyderabad International Airport Ltd, part of the GMR Group. Only last year, the operator had sought an UDF for arriving passengers as well, citing various reasons, including inflation and increased cost of operations — this was however turned down by the regulator.
Currently, domestic passengers departing from the Hyderabad airport have to pay an UDF of ₹430 plus taxes (effectively ₹484 per passenger) and international passengers ₹ 1,700 plus taxes (₹1,910).
“The authority has also decided that the facilitation component of the passenger service fee would now be merged with UDF. However, in case of HIAL, the authority has determined UDF as zero with effect from April 1 this year to March 31, 2016 for both domestic and international embarking passengers,” AERA said in an order issued late yesterday.
When contacted, a spokesperson of GMR Hyderabad International Airport said: “We are in the process of going through the AERA order and do not wish to make any specific comments at this stage.”
The Hyderabad airport, commissioned in March 2008, handled 6.3 million domestic passengers and 2.1 million international passengers in 2012-13. During the first half of the current fiscal it handled 3.2 million and 1.2 million domestic and international passengers, respectively. It has a designed capacity to handle 12 million passengers.