Mumbai, Delhi airports to abolish development fee

In a marginal relief to air passengers, the airport development fee (ADF) will be withdrawn at the Delhi and Mumbai airports from January 1, 2013.

Now the Delhi airport is charging Rs 200 per domestic passenger and Rs 1,300 per international passenger, while in Mumbai the fee is Rs 100 and Rs 600 respectively.

The move comes close on the heels of the Civil Aviation Minister Ajit Singh asking the Airports Authority of India (AAI) not to levy ADF in Chennai and Kolkata airports. The two airports are operated by the AAI unlike those in Delhi and Mumbai which are run by private companies.

The move comes following a direction from the minister to AAI to infuse more equity in Mumbai International Airport Ltd. (MIAL) and Delhi International Airport Ltd. (DIAL) with the objective of abolishing ADF in the airports.

The minister has asked the AAI to submit its proposals to Airports Economic Regulatory Authority (AERA) which will take a final decision on the issue.

An official release said on Tuesday that the expected financing gap in case of MIAL will be about Rs 4,200 crore, while in case of DIAL it will be roughly Rs 1,175 crore if the ADF is abolished with effect from January 1.

An official release said: “Emphasising on the objective of the Government to make air travel affordable and to ensure passengers are not subjected to any extra burden, the minister has asked the AAI to take on priority the equity infusion with the purpose of abolition of ADF. If the present funding gaps in case of MIAL and DIAL are met in terms of equity infusion and proportionate raising of loans by the airport promoters including AAI, the ADF will stand abolished.”

The issue had figured in the courts too. The Supreme Court on October 12 reverted the matter to AERA to decide on the legality of the issue. The court had refused an interim stay on the collection of fees. However, it had remarked that the common man should not be asked “to pay for executive lounges.”

The court was hearing two petitions, one filed by NGO Consumer Online Foundation, which challenged the levy of fees and another by Federation of Indian Airlines, which wanted to enhance the amount.  

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