To be sure, this is what the Adani Group has proposed to the Airports Economic Regulatory Authority (AERA). The regulator will come out with the final tariff order which usually sees lower rates than the ones suggested by airport operators, something that has happened in all tariff order till now.
While seeking comments on Chaudhary Charan Singh International Airport’s (CCSIA) aeronautical tariff proposal (ATP) for the “third control period” from April 1, 2021, to March 31, 2026, AERA says it “does its own due diligence and rationalises the tariff rates after (an) exhaustive consultation process and finalises the tariff rate card (after) considering the comments/views of all stakeholders. Final tariff rate card issued by the authority is likely to be different from that submitted by the airport operator.”
LIAL has also proposed tariff hikes for domestic and international cargo handling services and integrated fuel storage and into plane services. While UDF is directly paid by passengers, the other aero tariffs are levied on airlines who accordingly decide airfares based on their operating costs. Combined with anyway high airfares due to a weak rupee and expensive crude prices, the overall airfares could substantially rise.
CCSIA was the 12th busiest Indian airport in pre-Covid fiscal 2019-20 and 11th in FY 2021-22. The total traffic handled by it in FY 2019-20 was 54.6 lakh with 86% being domestic. It has a domestic and an international terminal. Both the existing terminals at CCSIA have been operating at full capacity. Airports Authority of India (AAI) had initiated development of a new integrated terminal (T3) in September 2018 in an area of over 1.5 lakh square metres to handle 1 crore passengers per annum to be built at a cost of about Rs 1,383 crore.
“…due to Covid pandemic and other reasons, the project got delayed and the overall physical progress of the awarded works was only 30%…Airport operator has issued a revised (cost) for Rs 2,030.5 crore,” AERA consultation paper on CCSIA says. The Adani group is now developing T3.
“…construction of T3 has been projected to be completed in two phases. Phase 1 with a capacity of 80 lakh passenger per annum is planned to be commissioned in FY 2023-24. Upon such commissioning, the airport operator (AO) has planned to shift the operations of both T1 and T2 to T3. Consequently, T1 is planned to be decommissioned and dismantled in order to pave the way for taking-up the expansion of T3 in phase 2,” the consultation paper says.
“…the capacity addition planned during phase 2 of (T3) is 50 lakh passengers per annum, which is planned for commissioning in FY 2024-25, after which the total capacity of T3 will be 1.3 crore passengers per annum. The AO plans to use T2 for administrative and operational purposes,” it adds.
The airport operator has also proposed a variable tariff plan (VTP) that will offer lower aero charges to scheduled airlines for starting new International routes to promote Lucknow’s direct connectivity. A new international route is one that has been unserved for last three years from Lucknow by any airline already operating flight from the capital of UP.
AERA will hold stakeholder consultation meeting on March 7 and comments and counter-comments have to be sent by March 24 and April 5, 2023, respectively. The final order will be issued after that.
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