Adani Airport Holdings Ltd (AAHL) has urged the central government to treat the Mumbai and Navi Mumbai airports as a single unit for tariff calculations, according to documents reviewed. If approved, this proposal could equalize airport charges for passengers and airlines across both facilities—potentially boosting traffic at the soon-to-be operational Navi Mumbai airport, which is critical to AAHL’s strategic plans.
Despite both airports being under AAHL’s ownership, tariffs such as passenger user fees, landing, and parking charges are expected to be significantly higher at Navi Mumbai, a greenfield airport built with an investment of ₹16,700 crore. In contrast, Mumbai airport is already an established facility with depreciated assets and lower capital expenditure. The disparity in charges may discourage airlines from relocating to Navi Mumbai, which is set to begin commercial operations in July.
To support its case, AAHL has cited the 2021 amendment to the Airports Economic Regulatory Authority (AERA) Act, which allows grouping of airports into a single economic entity—a move originally aimed at facilitating the privatization of smaller, loss-making airports by linking them with profitable ones.
A person familiar with the matter noted, “Since there has been a large capital invested in Navi Mumbai… naturally tariff at the airport will be significantly higher than Mumbai. If both airports’ tariffs are calculated as one unit, the charges at both airports will be the average of the two, bringing parity.”
AERA sets airport tariffs every five years based on operators’ capital expenditure, operational costs, depreciation, and non-aeronautical revenue, ensuring reasonable profit margins for airport operators. However, the higher cost structure at Navi Mumbai poses a challenge to drawing in airlines unless incentives or tariff equalization is implemented.
The proposal comes amid resistance from airlines, particularly after the International Air Transport Association (IATA) accused the Adani Group in March of leveraging its control over both airports to forcibly divert traffic to Navi Mumbai to jumpstart operations.
Compounding the urgency, AAHL plans to renovate Terminal 1 of the Mumbai airport beginning in October. This revamp is expected to shift around 15 million passengers to Terminal 2 and Navi Mumbai, underscoring the need for smooth operations and airline cooperation at the new facility.
Adding to the business incentive, the revenue-sharing terms are more favorable at Navi Mumbai. While Mumbai International Airport Ltd (MIAL) shares 38.7% of its gross revenue with the Airports Authority of India (AAI), Navi Mumbai International Airport Ltd (NMIAL) is only required to share 12.6% with the City and Industrial Development Corporation of Maharashtra (CIDCO).
Neither the Adani Group nor the Ministry of Civil Aviation have issued a public response to the proposal so far.
