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BIAL to retain user fee to fund expansion

March 10, 2008 11:17 IST
Bangalore International Airport Ltd (BIAL), the operator of the new airport at Devanahalli on the outskirts of the city, has ruled out withdrawing the user development fee (UDF) on both domestic and international passengers, saying it is needed to fund future expansion.

On the contrary, GMR Hyderabad International Airport Ltd (HIAL) withdrew user fees for domestic passengers bowing to pressure from public, budget airlines and the government. The developers, however, will levy Rs 1,000 as UDF for outbound international passengers.

There is pressure on BIAL from various quarters to withdraw the UDF, at least for domestic passengers. The Union civil aviation ministry has also written to the operator to reconsider the levy.

However, BIAL CEO Albert Brunner said his company was not in favour of withdrawing the user fees.

"The government wants us to review the UDF. But we are of the opinion that it has to be levied to fund future expansion. The user fee is just like a toll that a motorist pays to use an infrastructure project. We have, anyhow, announced to offer 50 per cent discount on the UDF for the first two months," he told reporters.

As part of the offer, the UDF will be Rs 240 plus taxes for domestic passengers and Rs 520 plus taxes for international passengers till May 31. Thereafter, the fee will be according to the concession agreement that is Rs 675 plus taxes per domestic passenger and Rs 955 plus taxes per international passenger.

"All over the world, the UDF for domestic as well as international passengers is the same. We have reduced it in the case of domestic passengers," Brunner contended.

He said BIAL had no option other than levying the UDF since the company had to incorporate the second phase of the project in the first phase.

"Due to the surge in air passenger traffic, we had to build a terminal to accommodate 14 million passengers during peak hour traffic," Brunner added. He also said a single runway was sufficient to manage the present flight movement.

"The runway can easily handle the movement of 30 aircraft (take-off and landing) without delay during peak hour traffic. We can even scale it up to 35 movements per hour. In fact, in Gatwick (UK), the airport with a single runway, handles 45 movements during peak hours," he pointed out.

BS Reporter in Bangalore