Flights from Mumbai get costlier

Written by fe Bureau | Mumbai | Updated: Feb 28 2009, 05:32am hrs
Flying out of Mumbai is to cost more from April 1 as the government on Friday approved levying development fee at Mumbai International Airport. Mumbai airportwhich became the fourth airport in the country to be allowed to levy a development fee from passengers to bridge the shortfall in funds for modernising the facilitywill charge Rs 100 from every outbound domestic passenger and Rs 600 from each international passenger, official sources said.

MIAL managing director GV Sanjay Reddy had recently said, We are facing a funding gap of Rs 2,000 crore. We have requested the government to allow us to levy an airport development fee to bridge this gap. He had also said, We are hopeful that the government will approve it. There are several mechanisms for filling the gap such as hiking aeronautical revenue, charging user-development fee and airport development fee and airport development fee is one of the options. According to sources, MIAL (Mumbai International Airport Ltd) which runs the Mumbai Airport had earlier asked the government for approval to levy an airport development fee of Rs 350 from domestic passengers and Rs 1,300 from international passengers flying out of the Mumbai airport.

On February 10, the government had approved levying Airport development fee (ADF) on passengers going out of Delhi airport, from March 1, at the rate of Rs 200 per domestic passenger and Rs 1,300 per passenger travelling abroad, a move that was criticised by the global airlines body International Air Transport Association (IATA). ADF will be in operation for four years in Mumbai and two years in New Delhi.

The Mumbai airport modernisation project cost is pegged at Rs 9,802 crore and the Mumbai International Airport Ltd has been allowed to raise up to Rs 1,543 crore through the development fee. However, if the project cost escalates beyond Rs 9,802 crore, MIAL would have to tap other fund sources.