Ajit Singh, Union Minister for Civil Aviation recently said that the delay in deciding tariffs by the Airport Economic Regulatory Authority (AERA) has led to financial stress for the Delhi International Airport Limited (DIAL). “AERA should have increased the tariff in 2009. Three years have gone by and no tariff was increased,” Singh said.
DIAL claimed earlier this week that it was facing acute financial stress, and if its proposed hike does not come through, it may have to shut down its operations in three-four months. Singh said DIAL’s demand for higher tariff was owing to their non-revision for the last ten years, barring one nominal increase of 10 per cent, according to a report by The Indian Express. DIAL, through its submission to the AERA, had sought an over 700 per cent hike in aeronatucial charges, which were opposed by airlines already reeling under a cash crunch and likely to post heavy losses. AERA, through its extensive stakeholder consultations early this year, proposed a 300 per cent hike. DIAL has opposed the hike and wants the Authority to allow it to charge Rs 400-800 User Development Fee from all passengers, in addition to the existing Development Fee.
Singh said Air India and Kingfisher’s inability to pay has also led to the airport operator’s grim financial situation. He said yesterday’s decision on the Rs 30,000 bailout for the cash-strapped national carrier may also bring relief to DIAL.
Siddharth Kapur, CFO - Airports, GMR, earlier said that nearly Rs 500 crore worth of combined dues of Air India and Kingfisher have also been a major setback to its smooth operations. “Kingfisher has started paying airport charges amounting to about 40 lakh-a-day regularly. We may ask them to increase payments by 15-20 lakh-a-day soon to recover pending dues,” said Kapur.
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Friday, April 13, 2012