Air passengers in Delhi’s national capital region can expect cheaper fares if they fly out of Noida’s Jewar airport, as airlines are seeking discounts on various charges for shifting to the new airport that is likely to begin operations in the second half of 2025.
Airports impose several charges on carriers for using their amenities, including landing fees and parking fees (based on weight of the aircraft), charges for air traffic control services, ground handling fees (like baggage handling), and terminal charges for using passenger facilities. All these charges are built into the tickets sold by airlines, jacking up airfares.
The Noida International Airport (NIA) in Jewar, which is running behind schedule by about six months, is operated by Yamuna International Airport Private Ltd, a wholly-owned arm of Zurich Airport International AG.
“These discounts in charges by the airport operator will help us offer cheaper fares that is likely to help attract passengers to the airport,” said an airline official, who did not want to be identified.
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Another official at a low-cost carrier said that they can bring passengers to Jewar airport if the fares are low. “No other incentive can bring passengers to Jewar.”
Analysts believe that discounts will help keep airfares low.
“While we have low-cost carriers (LCC), their fares are hardly low in comparison to other airlines. This is because we don’t have low-cost terminals, these airlines are paying same charges just like legacy airlines. This should be an opportunity to create low-cost terminals for LCC’s to make flying cheaper and to achieve the vision of Udan (scheme),” said Ajay Prakash, president of Travel Agents Federation of India (TAFI).
Udan is a central government scheme to connect underserved geographies of the country via affordable air travel.
There are several ways an airport operator can provide discounts to the airline. Some discounts are linked to a target of achieving a certain number of passengers and some are provided on a per-passenger basis.
The other reason that could help cheapen airfares in Jewar is a value-added tax of just 1% on jet fuel in Uttar Pradesh. By comparison, Delhi charges a 25% VAT on jet fuel, which accounts for about two-fifths of the cost of running an airline in India.
The new fiscal year will also see a new airport—Navi Mumbai International Airport—come up near Mumbai, India’s financial capital.
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While the airport in Navi Mumbai will complement the existing airport in Mumbai, as both are owned by the Adani Group, the airport in Jewar, Uttar Pradesh, will compete with an already established Delhi airport that is run by the Delhi International Airport Ltd, which is majority-owned by the GMR group.
Tafi’s Prakash is also of the view that the dual airport system especially near the national capital is a big opportunity to make India a world-class transit hub. “For connecting passengers to North America, Australia and other countries, we need to have attractive parking, landing, navigation and other charges. With dual airports coming up in Jewar and Navi Mumbai, it’s an excellent opportunity to make India a world-class transit hub,” he said.
Noida International Airport’s chief executive Christoph Schnellmann told Mint that the Delhi-NCR region requires additional capacity to handle the rising demand for air travel. “IndiGo will be our launch carrier, and we also have a partnership with Akasa Air. Airlines from the Middle East and Southeast Asia have shown strong interest in starting flights from NIA and we are currently engaged in discussions,” said Schnellmann.
Recently, officials from the Air India group also visited NIA and other airlines are also expected to visit the upcoming airport.
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NIA, which was expected to begin operations in 2024, has already missed one deadline. In the first phase, NIA’s passenger capacity will be 12 million annually and with one runway the airport will handle 100,000 air traffic movement. The airport is in talks with various airlines to start flights.
