GMR-led Delhi International Airport (DIAL) that manages Indira Gandhi International (IGI) Airport in New Delhi has said levying airport development fee (ADF) on passengers is needed as it is facing shortage of funds and is not in a position to infuse fresh capital.
The Delhi international airport project had faced a funding gap of Rs 1,793 crore and it needed to be bridged through ADF. Since the process of project cost finalisation has taken more than a year, the financial position of the company is under stress and an immediate relief is requested by levying ADF further, DIAL said.
The funding gap, pending finalisation of ADF, has been temporarily bridged by raising short-term loans and withholding project payments, Delhi International Airport said in its response to a consultation paper on 'Review and Levy of Development Fee at IGI Airport' by AREA.
Earlier in April, the Supreme Court had struck down the ADF charged on passengers by the private developer in Mumbai as it was not permitted by the regulator. It allowed the levy to go on in Delhi.
The apex court had clarified that ADF could be levied only after Airport Economic Regulatory Authority (AERA) approved it, fixed the rate and allowed its collection from the passengers.
Later in June, the Delhi High Court said the public notice allowing DIAL to Levy ADF can be challenged before the aviation tribunal. This prompted the company to ask airlines operating on IGI Airport to stop charging ADF.
AAI, which holds 26% in DIAL, has said it will not be able to infuse additional capital due to its own commitments. Lenders led by ICICI Bank also expressed their inability to extend more debt as it will disturb the prescribed 2:1 debt-equity ratio.
"AAI, a major shareholder, has stated that they cannot make any further equity commitment at this stage. Without the support of AAI, DIAL is unable to raise fresh equity as this will result in dilution of the shareholding of AAI/AAI nominees," Sidharth Kapur, Chief Financial Officer (Airports) said in the response to AERA.
He also informed that ICICI had last year indicated lack of debt serviceability and suggested exploring alternate sources for funds.
DIAL had again approached ICICI Bank to review the status considering, inter alia, the successful commissioning of the T3 project. The banks had re-iterated their earlier stand that any additional debt will lead to debt serviceability issues and DIAL may explore other sources of funds to bridge the funding gap of Rs 1,793 crore.
