E-Paper
DIAL expects tariff hike soon, airfare on Delhi routes may go up by 1.5-2%
The increase on air tickets will be 1.5 to 2% for domestic passengers and maximum 0.5% for international passengers, if the proposed tariff hikes get approved by the authorities
The domestic airfares for passengers flying to and from Delhi will increase by 1.5% to 2% by March end if the proposed tariff hikes get approved by the authorities, airport officials confirmed on Wednesday. These fares may increase by 0.5% for international passengers.
Delhi’s Indira Gandhi International (IGI) airport is managed by Delhi International Airport Ltd (DIAL), which on May 29 last year requested a tariff hike from the Airports Economic Regulatory Authority (AERA).
The statutory body regulates tariffs and charges for aeronautical services at airports. Aeronautical charges include landing and parking fees paid by airlines, as well as the user development fees (UDF) paid directly by passengers.
Early this month, DIAL submitted a proposed tariff card for aeronautical charges to AERA, under which it has proposed different user fees for economy and business class passengers as well as for peak (5am- 9am and 5pm-9pm) and off-peak hours. When approved, Delhi will become the only airport in India to have variable tariff rates, a practise that is commonly followed globally.
Videh Kumar Jaipuriar, DIAL chief executive officer (CEO), on Wednesday said the yield per passenger (YPP- includes airline charges and passenger charges) currently is Rs. 145. “This will rise to around ₹370 once the higher tariffs are approved,” he said.
“The increase on air tickets will be 1.5 to 2% for domestic passengers and maximum 0.5% for international passengers,” the CEO said.
Jaipuriar said that Delhi airport’s current base airfare is the same that the Airports Authority of India (AAI) charged in 2006, before the airport was privatised.
“While our ask was higher, AERA issued their judgement and released their consultation paper on January 31 where they stated that there would be a 140% increase of the base fare.”
As per new AERA rules, about 30% should be airline charges and passengers towards passenger charges. To be sure, in the current regime the ratio was 68:32, 68 being airline charges and 32 being passenger charges.
By this logic, out of the total increase of Rs. 370, 30% will be paid by airlines to the airport, and the balance amount will be paid by the passengers.
“Comparing the YPP of various domestic airports as against the proposed YPP of Delhi airport, Bangalore is Rs. 478. YPP’s of Chennai and Kolkata that are managed by AAI are Rs. 333 and Rs. 637 respectively.”
YPP of competing airport hubs like London Heathrow is Rs.3100, Amsterdam’s Schiphol airport is Rs. 1500, Paris airport is Rs. 1770, Hong Kong airport is Rs.946, Jaipuriar explained.
Since taking over the airport in 2006, DIAL has invested ₹30,000 crore, and ₹25,000 crore has been given as part of revenue sharing to the Airports Authority of India (AAI). For the current financial year ending March 31, 2025, DIAL is projected to record a loss of more than ₹1,500 crore.
Satyan Nayar, secretary general of Association of Private Airport Operators (APAO) in a statement said “The existing aeronautical tariffs at IGI Airport need to be revisited in line with the regulatory approach, as it does not reflect the development of large-scale infrastructure including the new Terminal 1, a fourth runway, and the Eastern Cross Taxiway amongst many others...Even with AERA’s proposed 140% tariff revision, IGI Airport’s charges will remain amongst the lowest in India and globally.”
