Travelers flying from Delhi and Mumbai airports may soon face significantly higher charges, following a recent TDSAT (Telecom Disputes Settlement and Appellate Tribunal) order that revised the methodology for calculating passenger fees. The ruling addresses the 2009–2014 tariff period, revealing that the airports incurred a loss of over ₹50,000 crore, which is now set to be recovered through increased user development fees (UDF), landing, and parking charges.
Potential Fee Hikes
If implemented, the UDF at Delhi Airport could rise from ₹129 to ₹1,261 for domestic travelers, and from ₹650 to ₹6,356 for international passengers. At Mumbai Airport, domestic passengers could see the fee jump from ₹175 to ₹3,856, while international travelers may pay as much as ₹13,495.
The significant increase has raised concerns among government officials about potential impacts on passenger volumes. “Legal disputes between airports and airlines should not negatively affect travelers,” said a senior official.
Background of the Dispute
The conflict dates back nearly two decades, to the 2006 privatization of airports. The Airports Economic Regulatory Authority (AERA) sets charges every five years, considering operator investments and returns. However, during the 2009–2014 period, airport ownership had changed hands—Delhi Airport (DIAL) was part of the GMR Group, while Mumbai Airport (MIAL) was under GVK, now managed by the Adani Group. This transition led to unreliable asset data, prompting the use of a ‘Hypothetical Regulatory Asset Base’ (HRAB) to estimate tariffs.
Initially, AERA accounted only for aeronautical assets like runways, terminals, and check-in counters when setting tariffs. Airports argued that non-aeronautical assets such as duty-free shops, parking, and lounges should also factor into fee calculations. The Supreme Court and TDSAT initially upheld AERA’s methodology. However, a recent TDSAT revision favored airport operators, recognizing non-aeronautical assets and increasing the recoverable tariff amount by ₹50,000 crore.
Impact on Passengers
This ruling could lead to an overnight surge in ticket prices, as airlines will have little choice but to pass on the increased costs to passengers. Lawmakers have repeatedly raised concerns about the steep rise in airport charges following privatization, highlighting the need for balanced regulations that do not burden travelers excessively.
The case is still under judicial review, with the Supreme Court expected to hear related petitions soon. Meanwhile, passengers using Delhi and Mumbai airports may need to prepare for significantly higher travel expenses in the coming months.