AAI starts collecting dues from foreign airlines directly as navigation fee

Process changed after Indian organisation's $29 million was seized in Europe in the Devas arbitration matter.

The Airport Authority of India (AAI) has returned to direct billing and collection of navigation charges from foreign airlines flying to India or using its airspace.

AAI switched back in the wake of court orders in Canada and Switzerland in the Devas arbitration matter that led to seizure of over $29 million of the Indian organisation’s dues. The International Air Transport Association (IATA) used to collect the dues on behalf of AAI.

AAI, as an air navigation service provider, collects navigation charges from domestic and foreign airlines for flights within the country, to/from India and those overflying the Indian airspace.

Domestic airlines pay the charges directly to AAI. Since 2007, IATA has been collecting overflight charges from foreign airlines. Over a period, the procedure was and air traffic data shared with IATA to make the process simpler and error free.

 “AAI has started billing and collection with effect from April 1 from foreign operators. The collection would be through AAI bank account and is done to protect the interest of AAI,” authority’s spokesperson said.

“While we are disappointed with the AAI decision, we understand and respect it. We will continue to engage with AAI and collaborate across other common areas of interest,” IATA said in an email.

In FY 2019-20 AAI collected over Rs 3592 crore in navigation charges from domestic and foreign airlines and this accounted for 28 per cent of revenue that year. The next year saw a 55 per cent drop in collection of navigation charges due to the Covid-19 pandemic.  In FY 2020-21 AAI managed to collect over Rs 1587 crore in navigation charges accounting for 32 per cent of its revenue that year.

Three Mauritius-based shareholders of Devas Multimedia had secured the seizure of AAI and Air India dues held by IATA from a Canadian court in November and December last year. Subsequently in January the Superior Court of Quebec in Canada set aside the seizure of AAI dues and limited the seizure of Air India dues to 50 per cent. But before the funds could be released and remitted to AAI, an order was passed in a Swiss court to attach the dues.

“The matter is sub judice in the Quebec court, Canada and in Switzerland,” AAI said.