Airport Lessons

News: The Jewar International Airport, a greenfield project will be the second airport in NCR. Both international airports in NCR will then be under private management.

It demonstrates India’s success in the last two decades in attracting private capital and management into airport infrastructure development and maintenance.

How private players’ participation was facilitated in airport development over the years?

The watershed moment was 2006, when Delhi and Mumbai airports were leased out for 30 years to private entities under a PPP model.

It was followed by greenfield airports in Bengaluru and Hyderabad.

Further, in 2008, a key development was the creation of a statutory body, Airports Economic Regulatory Authority (AERA) which regulates airport tariffs.

– It helped in getting both private capital and also buy-in from passengers.

The importance of a regulator can be gauged by the fact that in the case of railways, a lack of a regulator has hampered its efforts to attract private capital.

How has private participation helped?

It resulted in economic benefits from the increasing traffic – 341 million passengers in 2019-20. This revenue stream allowed Airports Authority of India (AAI) to develop airfields in locations that can’t attract private capital right now.

What is the way forward?

The future of greenfield airports and expansion of existing ones will depend on states. National Civil Aviation policy expects them to acquire land and provide it free for airports.

Source: This post is based on the article “Airport Lessons: Private airports are good for everyone” published in Times of India on 26th November 2021.

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