New Delhi/Mumbai: Air travellers flying frequently from Delhi’s Indira Gandhi International Airport and Mumbai’s Chhatrapati Shivaji Maharaj International Airport may soon face a steep surge in ticket prices, with user charges potentially rising up to 22 times. The development follows a Telecom Disputes Settlement and Appellate Tribunal (TDSAT) order that recalculates tariffs for the period between 2009 and 2014, creating massive dues for both airports.

Industry sources told Economic Times that the order, if implemented, could sharply increase the user development fee (UDF), which forms a key component of airline ticket pricing. The Airports Economic Regulatory Authority (AERA) and several domestic and international airlines have challenged the tribunal ruling in the Supreme Court, where the matter is set for hearing.

TDSAT order triggers massive dues for airports

According to the report, TDSAT’s revised tariff formula has resulted in outstanding dues exceeding ₹50,000 crore for Delhi and Mumbai airports combined. The dues pertain to the years shortly after the privatisation of major airports in 2006, during which the Airports Authority of India transferred operations of Delhi International Airport Limited (DIAL) to the GMR Group and Mumbai International Airport Limited (MIAL) to the then GVK Group, which is now managed by the Adani Group.

The recalculated dues are expected to be recovered through a combination of higher passenger fees, landing charges, and parking charges — all of which directly impact airline ticket prices.

Government officials have expressed concern that the increase could severely hit passenger growth. “Passengers shouldn’t become victims of protracted legal battles between airports and airlines,” an official said, warning that such a dramatic rise in ticket cost would be “a body blow” to travellers.

What passengers may have to pay

If the TDSAT order is enforced, domestic and international passengers at India’s busiest airports will see a major spike in UDF:

  • Delhi Airport
    • Domestic: from ₹129 to ₹1,261
    • International: from ₹650 to ₹6,356
  • Mumbai Airport
    • Domestic: from ₹175 to ₹3,856
    • International: from ₹615 to ₹13,495

Such unprecedented increases would make air travel substantially more expensive overnight. Airlines, which already operate with thin margins and limited pricing flexibility due to fuel costs and competitive pressure, are expected to pass these additional charges directly to passengers.

Why the dispute began

The issue dates back nearly two decades to the first phase of airport privatisation in 2006. AERA, the statutory regulator responsible for setting airport charges, was established only in 2009 — three years after private operators had already taken over.

The regulator sets airport charges in five-year regulatory periods based on investments, returns, and revenue-sharing structures. However, disagreements over tariff computation, revenue assessment, and investments made during the 2009–2014 window triggered disputes involving airport operators, airlines, and AERA.

TDSAT’s recent order essentially recalculates tariffs for that period using a methodology favourable to the airports, leading to the large dues now in question. Airlines and AERA have challenged the order, citing inaccuracies and the prohibitive financial burden on the aviation ecosystem.

Government fears setback to passenger growth

A senior government official expressed deep concern over the potential fallout. “Airports are natural monopolies and airlines will have no choice but to pass the charges on to passengers,” the official said.

The aviation sector has only recently stabilised post-pandemic, and both the Centre and industry stakeholders fear that a sudden spike in ticket costs could derail passenger growth, reduce travel demand, and impact tourism and business travel.

Supreme Court to hear the case

The Airports Economic Regulatory Authority, along with major airlines like Lufthansa, Air France and Gulf Air, has approached the Supreme Court against the tribunal ruling. A bench of Justices Aravind Kumar and Nilay Vipinchandra Anjaria is scheduled to hear the matter on Wednesday.

Industry observers say the court’s direction will decide whether India’s two busiest airports can impose the proposed charges or whether a fresh review of tariff calculation is needed.

Conclusion

With billions of rupees in dispute and stakeholders divided, the aviation sector is bracing for potential turbulence. Until the Supreme Court offers clarity, passengers may be left anxiously watching whether their airfares are set to skyrocket.