Airport privatisation may lead to higher fares: IATA

airplane-general pic-forwebThe global airline industry has warned the Indian government that flier in the country would end up paying much higher airfares if six major public sector airports in two metro cities and four state capitals are privatised after thousands of crores of public money have been spent to modernise them.

The civil aviation ministry, in co-ordination with the Prime Minister’s Office and the Planning Commission, wants to hand over a majority stake and the operation and maintenance responsibilities of the Lucknow, Ahmedabad, Jaipur, Chennai, Kolkata and Guwahati airports to private players. These airports are owned and managed by the Airports Authority of India (AAI) and have been recently upgraded.

Expressing grave concern about the move to privatise these airports without stakeholder consultations, the International Air Transport Association (IATA) has said that “any unnecessary private shareholding” may increase the focus on “profit-maximisation” and lead to higher user costs.

“The privatisation of these six AAI airports will only serve to fuel a further round of increases in the airport cost environment, adding to costs for passengers and the airlines,” IATA has warned in a missive sent last week to the government as well as the parliamentary committees in charge of transport and public sector undertakings.

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