User charges at Hyderabad airport cut by 30%; sets new tariff regime

The Airports Economic Regulatory Authority of India (AERA) has cut the user development fee (UDF) for domestic passengers departing from Hyderabad’s Rajiv Gandhi International Airport by more than 30%, reducing it from ₹750 to ₹515 under a new tariff calculation framework.

The revised tariff order will come into effect on September 1, 2026, and remain valid until March 31, 2031.

For departing domestic passengers, the airport operator had proposed ₹580 per passenger. For departing international passengers, AERA has fixed the UDF at ₹1,030 per passenger, down from the existing ₹1,500 and below the airport operator’s proposed ₹1,150.

The regulator has also reduced landing charges, fixing them at ₹435 per metric tonne for domestic flights and ₹630 per metric tonne for international flights during the tariff period.

New tariff formula changes cost recovery

AERA has introduced an incremental Aggregate Revenue Requirement (ARR) approach for the tariff period. Under the new methodology, recovery of project-related costs through airport charges is linked to the actual completion and commissioning of major capital projects.

The approach is intended to prevent passengers from being charged upfront for large projects that are yet to become operational. This includes major investments such as new terminal buildings, runways and taxiways, which are expected to be commissioned during the latter half of the tariff period.

Hyderabad airport operator had proposed an aggregate revenue requirement of ₹27,851 crore. However, AERA considered a baseline ARR of ₹11,683.49 crore for determining the tariffs; translating as a baseline yield per passenger (YPP) of ₹426.39, which formed the basis for determining the airport’s UDF, aircraft landing charges and parking charges.