July 13, 2008

UDF for Domestic Passengers Now

By K V Ramana

HYDERABAD: It's now the turn of domestic passengers flying out of the Rajiv Gandhi International Airport to pay the user development fee (UDF). GMR Hyderabad International Airport Ltd (GHIAL) - is likely to start collecting the fee from domestic passengers from August this year. The UDF is likely to be between Rs 150 and Rs 500.

The government allows the airport developer to collect UDF from passengers as part of the scheme to recover the investment made by the developer on setting up of the airport. All the international travellers departing from Hyderabad are already paying Rs 1,000 towards the UDF.

"We have already submitted a proposal to the ministry of civil aviation (MoCA) seeking their approval to collect UDF from domestic passengers as well. We are waiting for the go-ahead," an official source in GHIAL told TOI.

According to sources, GHIAL has submitted a detailed proposal explaining the financial viability of the airport and the need to collect UDF from domestic passengers also at the earliest. The developer has submitted five different models of UDF with the minimum fee at Rs 150 and maximum at Rs 500. The fee, as per the proposal, would vary depending on the distance a passenger travels and the time taken for the travel.

"The UDF for inter-state flight would be different from that levied on intra-state passengers. Those flying to destinations within the state are likely to pay less UDF compared to those travelling to other states," the source explained.

However, the state government, which is also a shareholder in GHIAL, is said to be opposing the proposal of levying UDF on intra- state passengers. "The government has been against the intra-state UDF. But, the developer (GHIAL) is keen on collecting it for viability reasons," a source in the government said.

In fact, the airport developers in Bangalore and Hyderabad are said to be up in arms against the MoCA on the issue of getting approvals for various tariffs. "Starting from vehicle parking fee at the airport to aircraft parking fee, everything has to be approved by the MoCA. Once the tariff issue goes to the ministry it would look at from the populist point of view than the business interest.

The UDF is one such issue that's not very encouraging as far as the developers are concerned," a source associated with a developer said.

For instance, GHIAL was keen on charging Rs 1,000 plus taxes from the international passengers. However, the ministry insisted that the fee of Rs 1,000 be inclusive of all taxes. "There was no option but to change it as per the ministry's directive irrespective of the viability," the source explained.

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