Mumbai: Mumbai International Airport Ltd (MIAL) won’t be able to charge airlines more for using its Chhatrapati Shivaji International Airport for now, with the tariff regulator Airports Economic Regulatory Authority Of India (Aera) saying the tariff hike it granted in March will not take effect at least until 30 September.

“Aeronautical tariff(s) approved by the authority dated 15 March 2013 shall continue up to 30 September 2016 or until the final determination of the tariffs for the second control period (ie 2014-19), whichever is earlier," Aera said in a notification dated 31 May posted on its website.

In March, Aera had recommended a 7% tariff hike, far lower than the 104.82% increase that MIAL wanted. The increase was supposed to take effect on 1 May.

A spokesperson for MIAL declined to comment.

MIAL is a joint venture, with the GVK Group-led consortium holding 74% and the Airports Authority of India holding the rest.

To be sure, Aera can still revise its final recommendation for a tariff increase based on the feedback it receives from the airport operator and other stakeholders.

Airport charges, levied to finance capital expenditure and pay for maintenance, are set for a five-year duration called the control period. These charges are passed on by the airport to airlines and, in turn, to travellers.

“The revenue so collected by MIAL during such period shall be adjusted from the aggregate revenue requirement for the second control period starting with effect from 1 April 2016," Aera said on its notification.

The second control period for MIAL was 2014-19 and the tariff revision is already late by two years. The first control period ran from 2009 to 2014.

“Aera will shortly come out with a final order on the tariff revision for MIAL," said a person close to the development, requesting anonymity.

D. Sudhakara Reddy, founder and national president of the lobby group Air Passengers Association of India said Aera has delayed consultation papers and final orders, impacting the interest of Indian passengers.

“Aera, as a regulator, is not taking the power into their hands and is allowing private airport operators to approach various courts while the regulator is not even intervening such cases. It goes to show that as a regulator, Aera is not using its power with them," Reddy said.

Even if Aera passes a final order, there is no certainty of the tariff revision being implemented as such decisions have often landed in the courts.

In December 2015, Aera had ordered a sharp 96% cut in airport charges for the 2014-19 period, upsetting operator Delhi International Airport Ltd (DIAL) which had sought a hike. The revised tariff was supposed to come into force on 1 January. DIAL is run by the GMR Group.

GMR Group challenged the reduction in the courts and now the matter is before the appellate tribunal.

Airport charges have gone up by 346% in Delhi, 269% in Chennai, 385% in Kolkata and 164% in Mumbai over the last three years.

In 2012, the Comptroller and Auditor General of India said the ministry of aviation favoured private firms managing the New Delhi and Mumbai airports.

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