Govt introduces bill in LS to amend AERA Act, change major airport definition

The government today introduced a bill in the Lok Sabha that seeks to amend the definition of major airports as well as have provisions for new tariff models for aerodromes.

The Airports Economic Regulatory Authority of India (Amendment) Bill, 2018, was tabled by Minister of State for Civil Aviation Jayant Sinha.

The AERA is an independent economic regulator for protection of interests of airports, airlines and passengers.

The ministry is looking to change the definition of 'major airport'. Once the amendment comes into effect, those aerodromes handling more than 3.5 million passengers annually would be classified as major airports.

At present, the threshold for being considered as a major airport is 1.5 million passengers every year.

The move comes amid rising air traffic in the country.

"... if too many airports come under the purview of the authority, it will be difficult on the part of the authority to efficiently determine the tariffs and monitor the service standards of major airports with the limited resources available," as per the bill's statement of objects and reasons.

Further, the ministry has proposed to introduce a new provision wherein different tariff models for airports can be included.

Various models, including pre-determined tariff indexed to inflation, are followed for engaging private partners in infrastructure projects.

"In this model, the market itself determines the charges and the regulator is not required to fix charges after the award of the project.

"The Act, in present form, does not cover airports to be operated under such model. Since this model is a means to reduce the airport charges, the airports in future may also be developed under this model," the statement said.