AAI's incentives to boost intn'l flights at Bhopal

Time of India

07-06-2025

Bhopal: The Airports Authority of India (AAI) initiated a significant development for international air connectivity at Bhopal airport. AAI introduced a scheme of incentives to attract airline operators in Bhopal.
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Director of Bhopal airport, Ramji Awasthi, stated that the operations department of AAI wants to boost international flights at thirteen underused international airports, including Bhopal's Raja Bhoj airport. "These airports currently have no international connections. To make this happen, they've proposed an incentive program for airlines," said Awasthi. He added, "The goal is to encourage airlines to start flying international routes from these locations.
This will help these airports grow and better serve their communities."
Airport officials mentioned that three of the 13 airports are major ones, while the other ten are smaller, non-major airports. The incentive scheme aims to encourage scheduled airlines to start international routes. The major airports included in the scheme are Patna, Srinagar, and Ayodhya. Srinagar and Port Blair are civil enclaves, meaning they share space with defence airports.
The ten non-major airports are divided into three clusters. Cluster 1 includes Agartala, Imphal, Vadodara, and Bhopal. Cluster 2 has Rajkot, Gaya, Aurangabad, and Tirupati. Cluster 3 consists of Kushinagar and Port Blair.
The incentive scheme offers benefits to airlines for each flight they land. For example, airlines flying to Agartala, Imphal, Vadodara, and Bhopal (Cluster 1) can get a full refund on landing fees, meaning they pay nothing to land their planes.
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Let's look at a specific example. An Airbus A320-74 MT landing at one of these airports would normally pay Rs. 57,129 in landing fees. With the 100% incentive, the airline pays nothing, saving them Rs. 57,129 per landing. Airlines also collect a "User Development Fee" (UDF) from passengers. This fee is used to improve airport facilities. For an A-320 with 144 passengers, the UDF collected would be Rs 107,280. The incentive scheme offers airlines a percentage of this UDF as an additional benefit.
In Cluster 1, which includes Bhopal, the incentive is 10% of the UDF collected. This means airlines get an extra Rs 10,728, bringing the total UDF revenue to Rs 96,552. The total additional revenue for airlines in Cluster 1 is calculated from landing fee savings and UDF incentives. The 'Net Landing' revenue (savings on landing fees) for all four airports is Rs 474,426.4. The 'Net UDF' revenue (incentives on UDF) is Rs 75,580, giving a total additional revenue of Rs 548,476.
The incentive percentages vary across the clusters, meaning the financial benefits for airlines will differ depending on which airports they fly to. The operations department hopes these incentives will be enough to attract airlines. More international flights will boost local economies and connect people to the world. The scheme aims to encourage international air connectivity and boost local economic development through these financial incentives.