The majority of passengers using Delhi Airport will not be impacted by the latest tariff order, which has kept the User Development Fee (UDF) for domestic departing passengers unchanged at ₹129 for the next four years, said the Airports Economic Regulatory Authority of India’s Chairperson S.K.G. Rahate.
“Effectively, AERA has kept nearly 80 per cent of total passengers out of the latest tariff order by maintaining the existing rate of ₹129 per departing domestic passenger,” Chairperson Rahate told businessline.
“AERA has prioritised the interest of domestic passengers by keeping the UDF unchanged. No impact on domestic ticket prices is expected to come from this tariff order.”
As per the chairperson, the rise in UDF for international passengers is ‘minimal’ when compared to the initial proposal of the operator.
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The airport operator (DIAL) had proposed an aeronautical rate for international economy class travellers between ₹430 and ₹810, while business class passengers will face fees ranging from ₹860 to ₹1,620.
Nonetheless, AERA for the said international passengers determined a lower rate of UDF, said Chairperson Rahate.
In the latest tariff, the international economy class departing travellers will be charged ₹650, while business class departing passengers will face fees of ₹810.
“In the international travel category, a differential rate for economy and business class travellers has been determined to protect the interests of economy class passengers,” he said.
“Even for the business class passengers, who receive an enhanced travel experience via facilities such as lounges and others, AERA has kept the UDF at a minimal.”
Besides, the chairperson cited that the airport operator had sought a 730 per cent increase in prevailing airport charges.
“AERA conducted a thorough analysis, called for stakeholder and public consultations, and arranged for ‘cross comments’ on the replies received from everyone,” Chairperson Rahate said.
“Only after the due process and analysis were complete did AERA determine a ‘significantly lower’ increase of 140 per cent over the existing airport charges. That too, by keeping the interest of domestic passengers safe.”
Furthermore, the chairperson elaborated that the ‘massive difference’ in the tariff rate that the airport operator had proposed was only made possible via a broad-based reduction in ‘unreasonable’ expenses that the operator had shown in its proposal.
At present, AERA has been entrusted with the responsibility to determine tariffs that are charged to airlines and departing passengers during the ‘Control Period,’ which spans 5 years.
Notably, the proposed tariffs by airport operators are reviewed, scrutinised, and revised by AERA every five years, considering the investment and expenditure incurred by the airport operator.
Meanwhile, the landing and parking charges for the airlines at Delhi airport have been rationalised and kept at “reasonable levels, considering competitive airport charges at similar airports,” the AERA order read.
“This ensures that airline operations are not unduly burdened and that operational efficiency is maintained.”
Earlier, airport operator DIAL had proposed higher aeronautical and non-aeronautical charges through a variable fee structure to recover expenses borne to build additional infrastructure.
The DIAL manages and operates the national capital’s IGI Airport under a public-private partnership (PPP) model.
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In addition, the AERA order read that the ‘adjustments’ made in the tariff rates will enable the airport operator to meet essential capital expenditure requirements, maintain operational efficiency, and ensure service quality.
As per the order, the yield per passenger (YPP) of ₹432 per departing passenger for DIAL for the fourth control period was then suitably apportioned between landing and parking charges, UDF, along with other airport charges along with their respective differential tariff structures.
“UDF now has been determined for both embarking and disembarking passengers as a significant portion of the airport infrastructure, including aerobridges, travelators, conveyor belts, and arrival facilities inside the terminal building, is also being used by the disembarking passengers,” the order read.
“Therefore, distributing the overall UDF charges between embarking and disembarking passengers in a suitable proportion to their actual usage of airport facilities would lead to an equitable distribution of the tariff burden amongst the users of the airport and would also spread out the costs amongst all airport users.”