new delhi: Responding to growing concern among lawmakers over surging airfares and steep user development fees (UDF), the Civil Aviation Ministry has proposed key amendments to the Airports Economic Regulatory Authority of India (AERA) Act, 2008.
The proposed reforms aim to balance passenger interests and airport operator demands by expanding AERA’s regulatory scope to include Maintenance, Repair, and Overhaul (MRO) services. Currently, MROs fall outside AERA’s purview under Section 2(a), allowing airport operators to impose arbitrary and often excessive charges.
The ministry plans to classify MRO under “aeronautical services”, paving the way for tariff regulation, transparency, and fairer pricing. Officials say this move will promote the domestic MRO sector, encouraging global OEMs and aircraft manufacturers to set up facilities in India. It would also save foreign exchange spent on maintaining Indian aircraft abroad while potentially earning forex through servicing foreign carriers. Other proposed changes include giving AERA authority to review airport operator expenditures and penalize non-compliance with performance standards, a step intended to boost accountability.
Significantly, the appellate jurisdiction for AERA’s decisions would shift from TDSAT to High Courts. The ministry cited TDSAT’s inadequate grasp of airport economics, often treating cases through a conventional financial lens instead of public utility infrastructure dynamics. Officials believe High Court benches, including commercial divisions, are better suited for complex airport-related disputes.
This overhaul follows the Public Accounts Committee’s (PAC) January demand for stronger regulation of private airport operators, citing “rising UDFs and a lack of transparency” since the privatisation of key airports.