All gratitude goes to the Airports Economic Regulatory Authority’s (AERA) for deciding to scrap the hefty user development fee (UDF) that airport operator GMR Hyderabad International Airport Ltd (GHIAL) charges domestic and international passengers at RGIA from April 1, 2014 till March 31, 2016.
From April 1 onwards, flying out of the swanky Rajiv Gandhi International Airport (RGIA) at Shamshabad is all set to be lighter on the pockets of the passengers.
At present, domestic passengers departing from Hyderabad airport have to forfeit Rs 430 plus taxes, which works out to Rs 484 per passenger, whereas international passengers have to cough up a whopping Rs 1,700 plus taxes, which counts up to Rs 1,910 per passenger. And only infants below two years are exempt from UDF charges taxed by airports to recover the cost of operations.
AERA in its order issued on Monday said, “The authority (AERA) has decided that the facilitation component of the passenger service fee (PSF) would now be merged with UDF. However, in case of GHIAL, the authority has determined UDF as zero with effect from April 1, 2014, till March 31, 2016, for both domestic and international embarking passengers.”
The order further asserted that as there will be no UDF, there would also correspondingly be no collection charge of Rs 5 per passenger with effect from April 1, 2014.
When contacted, a GHIAL spokesperson said, “We are in the process of going through the AERA order and do not wish to make any specific comments at this stage.”
The most recent AERA order comes even as GMR had been pushing for levying UDF on arriving passengers as well.
Though, its plea on arriving passenger UDF charges was rejected by AERA last year on the grounds that it was contrary to the concession agreement that the company had entered into with the government.
Meanwhile, the latest AERA order also stated that PSF will now include only the security component of Rs 130 per passenger with effect from April 1, 2014, and that there will be no facilitation component.
Presently, GHIAL charges a PSF of Rs 200 per passenger, including the facilitation component. While scrapping the UDF and slashing the PSF, AERA has decided not to change the common infrastructure charges, fuel supply charges and landing and parking charges being levied by RGIA.
The order comes as a blow for GMR, whose airport business was just stabilizing. GHIAL had managed to fly out of the red with profits of Rs 50 crore for the third quarter ended December 31, 2013, contrary to a loss of Rs 1 crore during the corresponding period of last fiscal. During the one-year period ended December 31, 2013, overall passenger traffic at RGIA grew 5%.
Things reduce to bare bones as user development fee of Rs 484 (Including tax) is charged from domestic passengers and Rs 1910 from international travelers, Zero UDF for a period of 2 years from April 1, 2014 to March 31, 2016 and UDF is levied by airports to recover cost of operations