Announcing the award at a press conference here, BAI President Himanta Biswa Sarma said the award will carry a citation and a cash award of Rs 10 lakhs.
He said BAI in its last executive meeting held in Bangalore had decided that every year the federation will honour one important personality who has contributed towards badminton with a life time achievement award.
"The decision to honour Padukone was taken at the core committee meeting of the association held here today," Sarma said.
Padukone had won the 1980 All England, besides bagging a bronze at the 1983 World Championship in Copenhagen. He also won a gold medal at the 1978 Commonwealth Games.
He was bestowed with the Arjuna award in 1972 and the Padma Shri in 1982.