Parliament passes Airports Economic Regulatory Authority of India (Amendment) Bill, 2021 – All you need to know

The Parliament on August 4, 2021 passed the Airports Economic Regulatory Authority of India (Amendment) Bill, 2021 after the Rajya Sabha approved it after a brief discussion amid protests by the opposition on various issues. 

The Lok Sabha had passed the bill earlier on July 29, 2021. The bill aims to amend the Airports Economic Regulatory Authority (AERA) of India Act, 2008 and seeks to encourage smaller airports to expand air connectivity to relatively remote and far-flung areas.

Airports Economic Regulatory Authority of India (Amendment) Bill, 2021

•The Airports Economic Regulatory Authority of India (Amendment) Bill, 2021, was introduced in the Lok Sabha in March 2021.

•The Bill will amend the Airports Economic Regulatory Authority (AERA) of India Act, 2008, by modifying the definition of ‘major airport’ under the AERA Act 2008.

Amendment of AERA Act 2008 – Significance

•The Amendment of AERA Act 2008 will now refer to an airport with annual passenger traffic of 35 lakh as a ‘major airport’ as compared to the previous traffic threshold of 15 lakh.

•The Amendment will also enable privatization of smaller loss-making Airport Authority of India (AAI)-run airports by pairing them with larger profit-making airports. As earlier, the move to privatize only larger profit-making airports was met with criticism that this move would leave AAI with only loss-making airports.

•The Amendment will also enable tariff fixation of more than one airport. As of now, the Airports Economic Regulatory Authority (AERA) determines tariffs and other charges for aeronautical services of a single airport.

Amendment of AERA Act 2008 – Benefits

•Aid in determining the tariff and other aeronautical services charges for a group of airports and development of smaller airports.

•Pair the smaller loss-making airports with larger profit-making airports to make it a viable combination for bidders for investment under PPP mode.

•Increase the air connectivity to relatively remote areas and as a result, expanding the UDAN scheme.

•Allow the Airport Economic Regulatory Authority (AERA) to regulate tariff and other charges for aeronautical services for not just a ‘major airport’ with annual passenger traffic of more than 335 lakh, but also for a group of airports together.