India’s aviation sector is booming, but a report by Business Standard has revealed that 9 out of 10 airports under AAI are loss-making. The AAI oversees a total of 125 airports in the country, of whom 109 are under loss.
Limited or nil aviation activity at these airports accounts for this loss. While airports like Delhi, Mumbai and Bangalore has seen a huge spurt in traffic, there are 30 airports in the country which have no airline traffic at all.
The number of domestic travellers in the month of January 2017 stood at 95.79 lakh, a jump of 25.13% over January 2016. Similarly, air traffic in the country has almost doubled from 11.69 crores in 2007-2008 to 22.36 crores in 2015-2016 (as per data from the Association of Private Airport Operators).
AAI’s annual income for FY 2016 stood at Rs.10,824 crore, with only 13 airports under it making profit. Private airports like Delhi International Airport and Mumbai International Airport accounted for one-third of this amount.
AAI recorded a profit of Rs.2,537 crore during the same period.
Bhopal Airport registered the highest loss of Rs.52.6 crore in this period, despite having regular flights.
Regional Connectivity Scheme aims to revive underutilised airports
The government is keen to improve air connectivity in the country, with the ambitious Regional Connectivity Scheme (RCS) aiming to accomplish this task. Under the scheme, the government will provide a subsidy to airlines flying to these cities. Airlines can charge a sum of Rs.2,500 for every hour of flying.
The subsidy will be categorised under Viability Gap Funding or VGF, with both the Centre and respective state government funding it.
As of January 2017, the AAI received 45 proposals for 200 routes. These proposals could revive 65 airports when implemented.