Higher charges at Delhi Airport upsets fliers, airlines

The newly introduced user development fee (UDF) at the Delhi airport seems to be upsetting many. Passengers and airlines will now have to pay 346% more on what they have been paying to the airport operator--the GMR Group along with its consortium.

Justifiying the incremental charges at the airport, Civil Aviation Minister Ajit Singh  today told mediapersons that the hike in UDF was needed as it was not raised in the past many years.

As per the airports regulator order, the UDF for international travel would be Rs 845.50 for outgoing passengers travelling between 2,000 -5,000 kms and Rs 699.17 for incoming ones. For those travelling beyond 5,000 kms, the UDF would be Rs 1,068 for outgoing and Rs 881.10 for incoming passengers.

For obvious reasons, hiked charges have not gone well with passengers. D Sudhakara Reddy, Air Passengers Association of India (APAI) told Moneycontrol.com, "The operator of Delhi Airport wants to pass on the burden of its losses to passengers which is unfair. It is making losses because the airport is under-utilised. "It is built to carry nearly 52 million passengers a year, but carries only around 25 million." He further says that the airport should have been built over 10 years in a modular fashion. "Why build 5.4 million square feet at once? It has escalated their cost," he questions.

But, GMR clarifies it stand on rasing charges. The company holds  54% stake in the Delhi Airport development project and has reported a net loss of Rs 450 crore in FY11. "The infrastructure and the operating cost at Delhi airport have changed dramatically. The initial cost of the project was around $2.8 billion three years ago when GMR took over infrastructure, but the total built-up area at the T3 terminal is seven times more then what it was decided, " Sidharath Kapur, CFO-Airports at GMRGroup had told CNBC-TV18 recently.

Meanwhile, even airlines are crying foul over the issue. They currently pay  Rs 227 per metric tonnes toward landing charges for international flights and Rs 170 per metric tonnes for domestic flights. Airlines have been opposing the hike since January this year, when officials at AERA (Airports Economic Regulatory Authority) had intimated to them about the hike.

In fact, some airlines had even threatened to withdraw flights from the airport. However, Jet Airways wants to pass on the incremental hike to passengers and the return fare on Mumbai-Delhi flight will be higher by as much as Rs 1,200, CNBC-TV18 has learnt.