Lok Sabha passes Airports Economic Regulatory Authority bill without debate

By: |
July 30, 2021 1:38 PM

Under the Modi government's Regional Connectivity Scheme- UDAN, air services have been started from several smaller cities in the country such as Darbhanga, Belgaum, Jharsuguda, Jagdalpur, and Hubli.

airports, AERA billJet Airways’ bankruptcy and closure in 2019, the likely sale of Air India, and the weakness of several existing airlines have sparked fears of a market share consolidation by major players.

On Thursday, a bill has been passed by Lok Sabha that seeks to encourage smaller airports in the country to expand air connectivity to far-flung and relatively remote regions. According to a PTI report, without a debate, the Airports Economic Regulatory Authority of India (Amendment) Bill, 2021 was passed amid uproar by opposition members over the Pegasus spying row as well as farmers’ issue. Union Minister of Civil Aviation Jyotiraditya Scindia said that the Modi government is committed to offer aviation services to all the people in India. Under the Modi government’s Regional Connectivity Scheme- UDAN, air services have been started from several smaller cities in the country such as Darbhanga, Belgaum, Jharsuguda, Jagdalpur, and Hubli.

As per the bill, the Airports Economic Regulatory Authority of India Act, 2008 provides for an AERA’s establishment in order to regulate tariff along with other charges for the aeronautical services rendered at airports as well as to monitor airports’ performance standards. The Airports Economic Regulatory Authority of India, being an independent regulator for the protection of the interests of airlines, airports and flyers, has been determining the tariffs of aeronautical charges at major airports since its inception. The AERA, however, does not provide for the determination of tariffs for a group of airports.

The airports where at present, the potential for traffic is low and loss making are unlikely to attract reasonable competitive bids. Building more airports through PPP (public-private partnership) mode would expand air connectivity to relatively far-flung and remote areas. According to the bill, this approach would develop high traffic volume profitable airports and also, low traffic volume airports that are non-profitable. Therefore, the Modi government has decided to club or pair airports having profitable and non profitable airports which could be offered as a package to the prospective bidders in PPP mode, as per the bill.

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