Govt Introduces AERAI Bill 2021, To Amend Definition Of ‘Major Airports’

Indian Bill Domestic - aviatorsbuzz
water cannon salute being accorded to the first aircraft at Dimapur Airport. Source: AAI

The Centre today introduced the Airports Economic Regulatory Authority of India (Amendment) Bill, 2021 in the Lok Sabha which proposes to amend the definition of ‘major airport’ to include the tariff aspect for other groups of airports.

Bill to Enable Airport Development: Govt

Civil Aviation Minister Hardeep Singh Puri on March 24 introduced the bill aiming to enable the development of both smaller and larger airports in public-private partnership mode. The tariff aspect is expected to encourage the development of smaller airports and bring them under the purview of the Airports Economic Regulatory Authority.

The Airports Economic Regulatory Authority of India has been determining the tariffs of aeronautical charges at major airports in the country and is expected to now do so for smaller airports as well.

Bill Tourism - Institutional Cap - A photo of Mumbai airport. Source: Subhajit Debnath - aviatorsbuzz
A photo of Mumbai airport. Source: Subhajit Debnath/@paradozaviator (instagram)

Amendment Clubs Airports

In the latest amendment, the government has decided to club or pair profitable and non-profitable airports, which could be offered in public-private partnership mode as a package to the prospective bidder.

Developing more number of airports through public-private partnership mode would expand air connectivity to relatively remote and far-flung areas.

Therefore, the government has decided to club or pair airports having profitable and non-profitable airports which could be offered in public-private partnership mode as a package to the prospective bidders.

The move to introduce the bill comes just a month after the government said it plans to privatize loss-making airports along with profitable ones in the next round of airport privatisation.

In the upcoming round, the government expects to hand over the operations and management of the airports at Amritsar, Varanasi, Bhubaneswar, Indore, Raipur, and Tiruchirappalli to private operators under the public-private partnership mode.

In 2019, the government had amended the definition of a ‘major airport’ to mean any airport with annual passenger throughput of over 3.5 million.

However, the earlier amendment does not provide for the determination of tariffs for a group of airports, those airports that currently have low traffic potential or are loss-making are not expected to attract reasonable competitive bids.

 

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