Airport users - both passengers as well as airlines - need to get ready to help finance the government's ambitious Rs 40,000-crore (Rs 400 billion) modernisation plan for airports across the country.
As part of a proposal which will be taken up by the Cabinet soon, the government wants to introduce user charges at airports to raise funds for building new airports.
As per the proposal, every international passenger will be taxed Rs 500 for every trip and domestic passengers taxed Rs 250 per trip. The government estimates that the passenger cess will raise over Rs 1,000 crore (Rs 10 billion) next year.
A proposal to this effect was mooted by the Prime Minister's Committee on Infrastructure. According to senior government officials, the proposal will now be considered by the Cabinet and a decision is expected soon.
The government had decided to raise up to Rs 40,000 crore by 2010 from various sources including internal accruals of Airports Authority of India, external borrowing by the government as well as from private sector partners.
One of the worst hit by the latest move will be the country's low-cost carriers, which may have to charge higher fares from passengers as well as pay higher landing and parking charges.
In developing airport infrastructure in the country, the government is expected to follow a hybrid model, with certain airports being developed in the public sector and some developed in private-public partnership. So far, private sector participation has been permitted only in the case of Delhi and Mumbai airports.
The government is expected to open airports across the country other than the North East to private sector participation. All the 80 operational airports managed by AAI will be upgraded in phases. In the first phase, about 25 airports, which account for all international travel from India, will be upgraded to global standards.
Besides, the government plans to develop about six greenfield airports across the country with an investment of over Rs 6,000 crore (Rs 60 billion).Do you want to discuss stock tips? Do you know a hot one? Join the Stock Market Investments Discussion Group
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