BIAL may collect UDF from Aug 24

BIAL may collect UDF from Aug 24
DH News Service, Bangalore:
The Bengaluru International Airport (BIA) authorities anxiously await Civil Aviation Ministrys nod to charge the much-talked about User Development Fee (UDF) on domestic passengers from August 24, when the new airport completes its three months of commercial operations.


Bengaluru International Airport Limited Chief Executive Officer Albert Brunner said on Wednesday that the company would go bankrupt within the first few years if it was not allowed to collect UDF from domestic passengers.

At an interactive session with the journalists in Deccan Herald, Brunner also emphasised that BIAL would hardly be in a position to start work on urgently needed capacity expansion projects at the BIA without being in a position to mobilise revenue. The BIAL was well within the bounds of the concession agreement it had signed with the government to levy UDF after three months of commercial operations.

Brunner while explaining that the UDF is actually a passenger fee, said, in India where people are price sensitive, the factors that go into the UDF were quite complex as everybody from the passenger to airline operators have to be satisfied.

While the government absorbed the cost burden in most of the airports by charging it on the government’s tax revenue, a Greenfield airport like the BIA had no option but to impose a user fee to recover the operational costs, he maintained.

However, even if the Centre gave the nod to impose UDF from August 24, the BIA would not be immediately in a position to collect it along with the air ticket. For sometime, at least BIA would have to collect the amount in cash at the check-in stage, he said. The BIA has proposed to charge Rs 675 per passenger on domestic routes.
“It could be collected in cash for the time being as a stop-gap arrangement and later incorporated into the airline tickets. With most airlines already issuing air-tickets, it would not be possible for them to collect it from passengers who travel, post-August 24. The issue now rests with the Ministry of Civil Aviation to decide the amount to be charged.

It could be communicated to us any time. Let’s hope the ministry takes a decision soon,” he added.
The CEO said BIA would address the need for a VIP lounge at the terminal. “The airport is equipped with a lounge for VVIP’s, such as the president and the prime minister.