NEW DELHI: The third round of airport privatisation, aimed to be completed next fiscal, will cover six to ten airports. The government will this time club small, loss-making airports with profitable ones that bidders wish to acquire, aviation secretary P S Kharola said on Thursday.
These airports, like the second round covering taking PPP route for six airports, will also be leased out for 50 years.
“The Airports Authority of India (AAI) is examining giving non-profitable airport and profit making airports as a package. We could see six to ten airports being taken up. The airports will be given to the private sector for a 50 years,” Kharola said.
A senior AAI official had told TOI that the six airports identified for privatisation in the third round are: Varanasi, Bhubaneswar, Raipur, Indore, Amritsar and Trichy. The number and names of smaller airports that will be clubbed with these is being worked out.
Speaking about FY 21-22 budget provisions for aviation, Kharola said there has been a 35% increase at Rs 600 crore for regional connectivity scheme (RCS) next fiscal.
While FY 20-21 budget had made a provision of Rs 430 crore for RCS, the same was increased to Rs 700 crore.
With the budget offering tax incentives to leading companies that set shop in Ahmedabad’s Gift City, Kharola sees leasing costs reducing for airlines with this move. “With leasing companies coming to India, cost leasing for airlines will reduce and help airlines.”
He added that domestic flight fare bands “will not be a permanent feature” and could be done away with once the number of flyers is back to pre-Covid levels.
India had suspended scheduled domestic flights for two months from March 25, 2020. Once they were allowed to partially resume on May 25, 2020, fare bands were put in place to ensure that passengers don’t face sudden fare surges and that financially strong airlines don’t come out with predatory low fares to drive weaker carriers out of business.
The fare band is in place till March 31, 2021, and a decision on either extending or scraping it will be taken before that.