The Airport Economic Regulatory Authority of India (AERA) serves as the regulatory body overseeing economic aspects of airport operations across India. Its primary purpose is to ensure fair and transparent pricing, efficient service delivery, and sustainable development within the airport sector. AERA regulates tariffs charged by airports for various services, including passenger facilities, cargo handling, and aircraft parking. By setting tariffs that balance the interests of airport operators, airlines, and passengers, AERA aims to promote competition, stimulate investment in airport infrastructure, and enhance the overall quality of airport services. Additionally, AERA plays a crucial role in safeguarding consumer interests, promoting affordability and accessibility, and fostering a conducive environment for the growth of the aviation industry.

Activities of the AERA

Tariff Regulation:

AERA is responsible for regulating the tariffs charged by major airports in India. This involves determining the maximum charges that airports can levy on airlines, passengers, and cargo operators for using airport facilities and services. AERA conducts detailed tariff consultations, considering factors such as operational costs, investment requirements, service quality, and the need for a reasonable return on investment for airport operators.

Airport Consultations:

AERA engages in consultations with stakeholders, including airport operators, airlines, cargo operators, passengers, and other relevant parties, to gather feedback and inputs on proposed tariff structures, service standards, and investment plans. These consultations ensure transparency, stakeholder engagement, and the incorporation of diverse perspectives in regulatory decisions.

Performance Monitoring:

AERA continuously monitors the performance of airports in terms of service quality, operational efficiency, financial performance, and compliance with regulatory requirements. This monitoring helps identify areas for improvement, assess the effectiveness of regulatory measures, and ensure that airports operate in accordance with established standards and regulations.

Cost Determination:

AERA conducts cost determination exercises to assess the operating and capital costs incurred by airports in providing various services to airlines, passengers, and cargo operators. This involves analyzing cost structures, investment plans, revenue projections, and efficiency levels to establish fair and reasonable tariff levels that balance the interests of airport operators and users.

Tariff Setting:

Based on the results of tariff consultations, cost determination exercises, and performance monitoring, AERA sets tariff structures and determines maximum permissible tariffs for airport services. Tariff setting aims to ensure affordability, competitiveness, and sustainability in airport operations while providing adequate returns to airport operators to support infrastructure development and maintenance.

Regulatory Compliance:

AERA ensures that airport operators comply with regulatory requirements related to tariff setting, service quality standards, financial reporting, and transparency. The authority conducts regular audits, inspections, and reviews to verify compliance and take corrective action if necessary to address any deviations or non-compliance issues.

Stakeholder Engagement:

AERA engages in proactive stakeholder engagement initiatives to enhance awareness, understanding, and participation in regulatory processes. This includes organizing workshops, seminars, public hearings, and information sessions to educate stakeholders about regulatory developments, solicit feedback, and foster collaboration in achieving regulatory objectives.

Policy Development:

AERA contributes to the development of policies, guidelines, and regulations related to airport economics, pricing principles, service quality benchmarks, and investment frameworks. The authority works closely with government agencies, industry associations, and international organizations to align regulatory practices with global best practices and emerging trends in airport management and regulation.

Dispute Resolution:

AERA provides a platform for resolving disputes between airport operators and users related to tariff issues, service quality concerns, contractual disputes, and other economic matters. The authority facilitates mediation, arbitration, or adjudication processes to resolve disputes efficiently and fairly, ensuring that conflicts do not impede airport operations or hinder industry growth.

Research and Analysis:

AERA conducts research and analysis on various topics related to airport economics, regulatory policy, industry trends, and emerging challenges. This includes conducting studies, publishing reports, and disseminating information to stakeholders to support evidence-based decision-making, promote innovation, and enhance the effectiveness of regulatory interventions in the airport sector.