Responding to demands from global airline bodies for reduced operating overheads, GMR Group Executive Director SGK Kishore defended the current tariff structure on Wednesday, November 4, 2026, stating that airport charges account for only 5% to 6% of overall passenger airfares in India.
The clarification follows statements made a day prior by International Air Transport Association (IATA) Director General Willie Walsh (formerly cited as IndiGo CEO in initial reports), who urged Indian regulatory authorities to lower airport tariffs and aviation taxes, arguing that airports operate as effective monopolies and should offer more competitive pricing to sustain passenger growth.
Capital Expenditure Linked to Air Traffic Growth
Countering the assertion that airport fees are levied arbitrarily, GMR’s Kishore emphasized that tariffs are determined through a transparent economic framework governed by the Airports Economic Regulatory Authority of India (AERA).
- Regulated Pricing Formula: Kishore clarified that neither airport operators nor airlines set these rates independently, as tariffs are calculated strictly using AERA’s statutory cost-plus formula.
- Infrastructure Scaling: He highlighted that charges directly correlate with the capital expenditure required to expand capacity. With Indian passenger traffic experiencing double-digit annual growth rates, continuous capital deployment is essential to prevent runway congestion and accommodate massive fleet orders placed by domestic carriers.
“The more capital the airport industry goes into the project, the airport charges are going to grow. When markets are growing, if I don’t do the capital infrastructure, where will all the aircraft be parked?”
— SGK Kishore, Executive Director, GMR Group
Technological Interventions to Boost Terminal Capacity
To manage operational costs without compromising passenger experience, Kishore noted that airport operators are actively prioritizing throughput optimization over pure reliance on fresh capital expenditure:
- Off-Site Processing: GMR has piloted projects in Hyderabad that move traditional indoor airport functions—such as check-in baggage drops—to off-terminal locations.
- Digital Flow Optimization: By deploying advanced queue-management and biometric passenger processing technologies, operators aim to expand handling capacity within existing terminal footprints.
