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Flying From Bengaluru Airport Gets Costlier After A Sharp Hike In User Fee

Starting 16 April, flying from Bengaluru airport will be costlier as Bengaluru International Airport (BIAL) gets regulatory approval from AERA to charge a massive user development fee (UDF). The UDF was increased by around 120 percent on tickets issued between 16 April and 15 August.

“With the Aera order coming into effect from April 16, the UDF for domestic departures will be revised to Rs 306 from Rs 139 while for international departures it will be Rs 1,226 from Rs 558 earlier,” the official statement from BIAL said.

Bengaluru is the country’s third busiest airport (after Delhi and Mumbai) and it is looking to collect between Rs 350 crore to Rs 450 crore from the hike to fund its second phase of expansion.The expansion that is estimated to cost Rs 13,000 crore entails construction of a new terminal, a second runway, access roads, and a multi-modal transport hub. The work is expected to be completed by March 2021 according to a PTI report.

The AERA (Airports Economic Regulatory Authority) has mandated that the money collected from the incremental UDF in the four months will be deposited in a separate bank account and used only on ongoing expansion.

The Kempegowda International Airport began its operations in May 2008 and is the second airport build on a PPP (private-public partnership) model after Kochi which was commissioned in the late 1990s. It handled 26.91 million passengers in the financial year 2017-18 and is one of the fastest growing in the world.

Majority stake, that is 51 percent of the airport is owned by Canadian NRI Prem Watsa-run Fairfax. Siemens Projects Ventures holds 20 percent, while the Karnataka government and the Airports Authority hold 26 percent and 13 percent, respectively.

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