Indian Aviation to boom as govt privatises many airports |
India`s Union Cabinet on Monday approved the note on doubling the passenger traffic threshold for airports to be categorised as `major airports,` effectively reducing the ambit of the Airports Economic Regulatory Authority also known as AERA. The Cabinet also approved an amendment to the AERA Act that will allow the government to bid out private airport projects on the basis of predetermined tariff. AERA was created to decide charges at major airports, ones which handled over 1.5 million passengers per annum. According to the aviation ministry proposal, now only airports handling 3.5 million passengers per annum will be classified as `major,` removing 17 airports from the ambit of AERA. The Aviation industry can now expect respite in charges as AERA, which regulated 30 airports, will now have only 13 airports under it. The job of deciding charges at the remaining 17 now comes back to the civil aviation ministry, and airlines and passengers can expect respite in charges. The amendment will allow the government to award projects after fixing the airport tariff. This model will help keep airport charges under control and also ensure regulatory certainty —not just for airlines and passengers,but also for companies bidding for PPP airport projects.
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