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Privatisation: Airport charges at Adani-run Lucknow airport jump 10x

The Adani Group won operating contracts for the previously government-run Ahmedabad, Guwahati, Jaipur, Lucknow, Mangalore and Thiruvananthapuram airports for 50 years in 2019.

May 31, 2021 / 10:29 AM IST
Airports privatisation has previously led to increased charges at the Bengaluru, Delhi, Mumbai and Hyderabad airports – which was stiffly opposed by airport bodies such as the International Air Transport Association and Federation of Indian Airlines.  (Representational Image: Shutterstock)

Airports privatisation has previously led to increased charges at the Bengaluru, Delhi, Mumbai and Hyderabad airports – which was stiffly opposed by airport bodies such as the International Air Transport Association and Federation of Indian Airlines. (Representational Image: Shutterstock)

The Adani Group has “drastically” raised charges, by as much as 10 times, including turnaround charges of international flights and private jets at Lucknow airport, The Economic Times reported.

This comes after the Group won bids to operate six government airports across the country and industry insiders also expect increased charges at the other five airports soon, it noted.

Adani Group won operating contracts for the previously government-run Ahmedabad, Guwahati, Jaipur, Lucknow, Mangalore and Thiruvananthapuram airports for 50 years in 2019.

The report states that ground handling companies have “leeway to increase charges” for a few things, despite a lot of the charges being regulated by either the government or Airport Economic Regulatory Authority (AERA).

Moneycontrol could not independently verify the report.

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Adani took over operation of the Lucknow airport in late 2020 and has appointed a new ground handling company for it, which has increased prices, it added.

Adani Group did not respond to queries, as per the report.

Notably, AERA stipulated charges for airports last for five years and those for the Lucknow airport ended in 2020. A decision on charges for the next five years is still pending.

A business jet aircraft operator however complained that there is “no significant improvement in services to justify the huge spike in charges”, adding that a majority of the business flights to Lucknow are medical evacuation flights.

An airline executive also noted that airlines would be willing to pay more “only if infrastructure comes packaged with improved efficiencies”, adding that the “real test” will happen once air traffic is back to normal.

Airports privatisation has previously led to increased charges at the Bengaluru, Delhi, Mumbai and Hyderabad airports – which was stiffly opposed by airport bodies such as the International Air Transport Association and Federation of Indian Airlines.

In lieu of this, the government in 2018 brought in changes in the bidding criteria to move away from the revenue sharing model (Mumbai and Delhi) to per-passenger revenue model (the six won by Adani). However, charges have continued to increase.



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first published: May 31, 2021 10:29 am
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