Indian and foreigner carriers have criticised the Delhi International Airport Limited (DIAL)’s demand for a 774 per cent hike in the airport tariffs. IATA has also objected the proposed increase that could well make flights to India’s capital expensive.

A host of domestic and foreign airlines have panned the Delhi airport operator’s proposal for an eight-fold hike in airport tariffs.

International travellers taking flights to India landing in Delhi could well have to shell out more from April in case Delhi International Airport Limited (DIAL) manages to impress upon the Airports Economic Regulatory Authority (AERA) the viability of the proposed hike. Cheap flights to India‘s capital will definitely turn rarer if airlines pass on some (even if not all) of this tax increase to passengers.

The airlines, in their representations before AERA, have cautioned that such a considerable hike would result in passengers moving away from the Delhi Airport. The carriers said the proposed charges, if implemented, will be more than those levied at Singapore, Bangkok, Dubai and Hong Kong put together.

DIAL defended the demand by stating the tariff hike would not have a significant effect on the airlines’ revenues and on the other hand it would help the Airports Authority of India’s (AAI) revenues. AAI is entitled to 46% revenue share rights in the Delhi International Airport.

DIAL shielded its proposal by also adding that there has been no hike in airport charges in about a decade apart from the one in 2009 when the tariffs were increased by 10%.

However, not many airlines are willing to buy this argument. Even airline representative organisations like International Air Transport Association (IATA), Board of Airline Representatives in India (BAR-I) and Federation of Indian Airlines (FIA) has opposed the hike proposal.

“Despite the proposed increase being a significant moderation from the increase proposed by Delhi International Airport Ltd (DIAL) would still have a severe impact in the viability of airlines operating IGI airport. AERA must not allow such a quantum of increase in airport tariff to be loaded on the industry. It would make Delhi the most expensive airport in Asia if not the world,” Malvyn Tan, Assistant Director, Industry Charges, Fuel and Taxation, IATA has been stated as communicating.

IATA has also urged the Indian Government to review the concession agreement between the AAI and DIAL.

IATA further advocated the proposed increase in airport charges would act as a hindrance in the Indian aviation growth and it will also prove to be an impediment in Delhi’s aspiration to become a major air travel hub.

 

 

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