Centre Revives Airport Privatisation Plan with 11 AAI Airports in Five Bundles

The Centre is preparing to revive its airport privatisation programme, with 11 Airports Authority of India (AAI) airports proposed to be offered to private operators through five long-term public-private partnership (PPP) bundles.

The Public Private Partnership Appraisal Committee (PPPAC) gave in-principle approval to the proposal at its meeting on August 4. Under the plan, the airports would be offered for operation, management and development for 50 years.

The five proposed bundles are Amritsar-Kangra, Varanasi-Gaya-Kushinagar, Bhubaneswar-Hubballi, Raipur-Aurangabad and Tiruchirappalli-Tirupati.

The bundling strategy is designed to combine relatively stronger airports with smaller ones. This would allow the private operator to use cash flows generated by larger airports to support operations and investment at the smaller facilities.

How the airport privatisation model will work

The bidding parameter is proposed to be the fee charged per domestic passenger, while the fee for international passengers will be set at twice the domestic passenger fee.

The private concessionaire will be responsible for the operation, management and development of the airports. Air traffic control, along with communication, navigation and surveillance services, will continue to remain with AAI.

One of the most significant changes in the latest airport privatisation plan is the proposed cap on the number of bundles that a single bidder can win.

The move comes amid concerns about increasing concentration in the airport sector. The Finance Ministry has flagged the risks associated with an oligopolistic market structure, including excessive concentration and over-leveraging by a single airport operator.

The exact limit on the number of bundles a bidder can secure has not yet been finalised. The Civil Aviation Ministry is expected to place the proposed cap before the PPPAC when it seeks the committee’s final recommendation.

A different approach from the earlier airport auction

The proposed bidder cap marks a departure from the previous major airport privatisation exercise in 2018-19, when Adani Enterprises emerged as the highest bidder for all six airports offered by AAI — Ahmedabad, Lucknow, Mangaluru, Jaipur, Guwahati and Thiruvananthapuram.

Private airport operators have since gained a larger presence in the sector. Adani Airport Holdings currently operates eight airports, while GMR Airports has a significant portfolio across key Indian aviation markets.

AAI, however, remains the country’s largest airport infrastructure owner by number, managing 129 airports, including international, customs and domestic facilities.

Five airport bundles proposed

The current plan brings together 11 airports across five combinations:

Amritsar-Kangra

Varanasi-Gaya-Kushinagar

Bhubaneswar-Hubballi

Raipur-Aurangabad

Tiruchirappalli-Tirupati


The Centre had previously considered a larger PPP programme involving 13 airports, with smaller airports paired with larger facilities to make the assets more attractive to private operators. That plan, however, did not result in a completed auction of all the proposed airports.

The latest proposal therefore represents a more targeted approach, while also introducing a safeguard intended to prevent one operator from accumulating an excessive share of airport assets.

For the government, the programme is part of a broader effort to bring private capital and operational expertise into airport infrastructure. For potential bidders, the combination of long-term concessions, established passenger traffic at larger airports and development opportunities at smaller airports could make the bundles attractive.

The success of the exercise will ultimately depend on the final concession structure, bidder cap and the government’s ability to balance private participation with competition in an increasingly concentrated airport market.