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Airlines oppose hike in user development fee.

ANTICIPATING a drop in passenger traffic, domestic airline operators have opposed a proposal mooted by GMR Hyderabad International Airport ( GHIAL) to hike user development fee ( UDF) before the airport regulator Airports Economic Regulatory Authority ( AERA).

A top AERA official told MAIL TODAY that it may take a view on this issue in the next two weeks.

Representatives from various domestic airlines had met AERA officials in Hyderabad on September 29 and explained that this move would encourage other airport operators also to hike user development fees.

GHIAL, which has developed the Greenfield Hyderabad International Airport, also operates it. It also operates the Indira Gandhi International Airport ( IGIA) at New Delhi.

GHIAL has told AERA that the increase in UDF is required to maintain the globally benchmarked performance standards and was also backed by the state government. The GHIAL, which termed the UDF levied at present as inadequate, had earlier sought to increase the user development fee from ` 340 to ` 500 per departing domestic passenger and from ` 907 to ` 2,825 per departing international passenger.

AERA, in a consultation paper issued last month, had proposed to increase the UDF from ` 340 to ` 420 per departing passengers and from ` 907 to ` 1,656 for the airport on an adhoc basis as the Hyderabad international airport has suffered losses in 2008- 09 and 2009- 10.

While the revised UDF rates may improve the viability of the airport, any increase may discourage air passengers that would eventually lead to a drop in traffic growth, airlines have told AERA.

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Publication:Mail Today (New Delhi, India)
Geographic Code:9INDI
Date:Oct 11, 2010
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