New Delhi: In a rebuff of sorts, airport developers of the New Delhi and Mumbai airports have turned down civil aviation minister Praful Patel's request to reduce parking and landing charges. Instead, they have asked the ministry to allow them to increase charges across the board by 10 per cent.
Patel had asked airport developers to reduce charges in an attempt to ease the operating woes of domestic airlines, which are battling to overcome rising fuel costs and a slump in travel.
The GMR and GVK Group, developers of Delhi's IGI and Mumbai's CST airports, have pointed out that their contract allows them to increase charges two years after initiating work. Both the developers have already completed two years of operations.
Patel's exhortation to reduce charges had come in the wake of industry concerns that airlines would cumulatively register a year-ending loss of Rs8,000 crore this fiscal. Airport charges constitute 12 per cent of the cost of operating an airline in India.
The airport developers have pointed out that cost of construction material, such as steel and cement, has gone up by 10-15 per cent over the last six months. If this rise in costs is not offset, developers said, then airports in the country too would start bleeding as growth in air passengers is already slowing down.