Lok Sabha passes AERA bill on airport privatisation

31 Jul 2021 CW Team

The Airport Economic Regulatory Authority (AERA) Amendment Bill has been passed by the Lok Sabha on Thursday to privatise a small loss-making airport by joining it with a larger airport.

Civil Aviation Minister, Jyotiraditya Scindia, introduced the Amendment Bill and passed it amid din in the lower house. It offers to make changes to the definition of a significant airport under the AERA Act 2008 and will have to be passed by Rajya Sabha for the amendment to come into effect.

The action to club loss-making Airport Authority of India (AAI) run airports with larger ones is being initiated following criticism of the existing policy. It felt that the privatisation of the larger airports would leave AAI saddled with only small loss-making airports.

As indicated by the partner of J Sagar Associates, Poonam Verma, the bill offers to amend the definition of "major airport" under Section 2(i) of the Airports Economic Regulatory Authority Act, 2008, including a group of airports' in place of 'any other airport'.

Verma told the media that the objective of this amendment is to pair the smaller non-profitable airports with profitable airports as a package to the bidders to make it a possible combination for investment under PPP mode and that this move is also likely to help expand the air connectivity to relatively remote areas and, as a result, expedite the UDAN scheme. She also said that the amendment would allow AERA to regulate tariff and other charges for aeronautical services for not just major airports with annual passenger traffic of over 3.5 million but also a group of airports together.

The airport sector regulator decides the tariff of a single airport at present, and the amendment will allow for tariff fixation of more than one airport.

Image Source

Also read: Deloitte appointed as consultant for Nagpur airport privatisation

Also read: Next stage of airport privatisation to begin in April

The Airport Economic Regulatory Authority (AERA) Amendment Bill has been passed by the Lok Sabha on Thursday to privatise a small loss-making airport by joining it with a larger airport. Civil Aviation Minister, Jyotiraditya Scindia, introduced the Amendment Bill and passed it amid din in the lower house. It offers to make changes to the definition of a significant airport under the AERA Act 2008 and will have to be passed by Rajya Sabha for the amendment to come into effect. The action to club loss-making Airport Authority of India (AAI) run airports with larger ones is being initiated following criticism of the existing policy. It felt that the privatisation of the larger airports would leave AAI saddled with only small loss-making airports. As indicated by the partner of J Sagar Associates, Poonam Verma, the bill offers to amend the definition of major airport under Section 2(i) of the Airports Economic Regulatory Authority Act, 2008, including a group of airports' in place of 'any other airport'. Verma told the media that the objective of this amendment is to pair the smaller non-profitable airports with profitable airports as a package to the bidders to make it a possible combination for investment under PPP mode and that this move is also likely to help expand the air connectivity to relatively remote areas and, as a result, expedite the UDAN scheme. She also said that the amendment would allow AERA to regulate tariff and other charges for aeronautical services for not just major airports with annual passenger traffic of over 3.5 million but also a group of airports together. The airport sector regulator decides the tariff of a single airport at present, and the amendment will allow for tariff fixation of more than one airport. Image Source Also read: Deloitte appointed as consultant for Nagpur airport privatisation Also read: Next stage of airport privatisation to begin in April

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