Ministry To Settle Aai, Ia Dispute

The civil aviation ministry will intervene to settle the dispute between the Airport Authority of India (AAI) and Indian Airlines (IA) over rent at airports, including the new terminal at Delhi. The AAI is demanding Rs 336 per square metre per month from Indian Airlines while IA is paying Rs 184 per square metre per month for the new terminal at Delhi airport.

AAI sources pointed out that Jet Airways and other private operators pay Rs 336 per square metre per month for space at the old terminal. Also, the AAI wants revision of charges at all locations and a hike of 10 per cent per annum every three years.

Indian Airlines is seeking differential rates from Airport Authority of India on the ground that the domestic carrier pays for usage at remote airports and, as a result, helps to keep these airports functioning.

Also, since it is a "bulk user", charges should be lower, IA argues. AAI, however, argues that IA already owes it around Rs 100 crore over previous hikes that the airline has ignored.

"After all, IA is now making profit. There is no reason why it cannot pay the same rate as private airlines," said an Airport Authority of India official.

He pointed out that Terminal I A in Delhi is a state-of-the-art terminal on which AAI spent Rs 24 crore and that IA must pay the higher rent for the authority to recover costs.

With no solution emerging, the issue is now to be settled by the financial advisor in the ministry, P K Brahma.\

Indian Airlines, however, argues that increased Airport Authority of India charges in the current year will exceed Rs 50 crore and that a revision of rent will be a huge additional burden that the airline cannot shoulder at this stage.