The bill to set up an Airport Economic Regulatory Authority, which will fix tariffs for different agencies involved in airport operations and management, will be introduced in the budget session of Parliament next year.

This was disclosed by Praful Patel, Union civil aviation minister, while addressing the inaugural session of the Aerodrome India 2006, which started in Delhi on Thursday.

"The matter has been deliberated by the Group of Ministers' and the proposal will be sent to the parliament shortly. The GoM sorted out issues pertaining to large number of defence airfields in the country and we may have representative from the defence sector in AERA. Due to some procedural formalities, the proposal will take some time to be cleared by the Cabinet and will be presented in the parliament in the fothcoming budget session."

The proposal empowers the regulators (including private airport promoters) to fix tariff, including landing charges, for each airport on the basis of existing facilities so that investors get a fair share of return on their investments.

Headed by a chairman and supported by two members, AERA, on the lines of the US Federal Aviation Authority, will monitor the performance of each airport and ensure that the standards maintained are commensurate to the tariff charged by the airport promoter.

"AERA will be the first step towards global practices in the aviation infrastructure business. Besides this, we are also planning to allow 100 per cent foreign investment in development of airport infrastructure. On the model of Cochin airport, we will be promoting more greenfield airports in the country to take on the expected increase of air passengers in future," Praful said.

The government is also planning to liberalise air space and airfields in the country to reduce travel time. Besides the Airports' Authority of India, which controls a major part of the domestic air space, Defence Ministry is also being involved in the process.

Ajay Prasad, secretary, Civil Aviation, in his address said: "We are trying to liberalise and streamline air travel routes in the country for more profitability in the aviation business. Talks are on with different nations including, Asean and Middle-east countries to reduce air route distances."