Airport fees represent just 5‑6% of ticket prices, says GMR executive amid calls for cuts

Airport charges make up only five to six percent of ticket prices, a GMR Group executive said while defending the recent rise in airport operation costs. The comment came a day after IndiGo chief executive Willie Walsh urged the government to cut airport charges and taxes, arguing that high fees hurt the market because airports act as monopolies. Walsh said lower taxes and lower charges are the way forward. SGK Kishore, executive director of GMR Group, said charges are not set arbitrarily; they are determined by the Airports Economic Regulatory Authority of India Act using a clear formula. He explained that fees reflect the amount of capital investment needed to expand infrastructure as air traffic grows. Passenger traffic at major Indian airports has risen at double‑digit rates in recent years and was about 18‑20 % before the Covid‑19 pandemic. Kishore warned that without new capital, there would be nowhere to park the increasing number of aircraft. He added that airport operators are trying to squeeze more capacity from existing terminals through technology rather than only spending on new construction. GMR, for example, has tested moving check‑in baggage handling outside the Hyderabad terminal to cut space and cost.

Context

Airport fees are a small slice of overall fare but rise when airports need money for new runways, terminals and parking bays. The Airports Economic Regulatory Authority of India Act sets a formula so operators cannot charge arbitrarily. Airlines push for lower fees to keep ticket prices affordable, while operators argue that fees fund needed upgrades.