2023 → Indian airports will make $3.9 billion 💰 Adani is the front runner in buying airports 🤯
Here's how the airport economy works ⬇️
The Indian airport's story ✨
It all started with privatizing Cochin airport (1999), followed by Hyderabad (2002), Bengaluru (2004), Delhi & Mumbai (2006).
But, why the move in last 20 years? 💭
According to the government, selling airports is generating short term cash for Airport Authority of India (AAI) & will be used to develop better Aviation infrastructure in India. I'm going to take a pause here - I think you understand what's cooking ;)
How did Airports become so cash-rich? 💸
Airports are micro-monopolies approved by the government. Within the perimeter of airports, the private operating companies lay the laws of commerce.
1/ Flight arrivals & parking 🛬
Bangalore airport is paid Rs.839 per international passenger & Rs.184 for domestic passenger. This is part of passengers' final ticket price. Larger planes (A320) have to pay as much as 1L/day for a day of parking. This is the major revenue source for airports.
2/ Airport bridges 🚌
Observed how domestic airlines almost never use the airport bridges to deplane passengers? Cause it costs exponentially higher than using a ramp. Now you know why we waste time with those ramps.
3/ Terminal revenue 🍔
Restaurants & retail shops pay a fixed rent to use the commercial space. Plus, few lease agreements involve revenue sharing with the airport on every good sold. Airports invented their own tax model ;)
4/ Parking & cab operating rights 💰
This is straight forward revenue from vehicles coming into the airport area & parking for short/long duration. Plus, Airports sell rights to cab aggregators (OLA, Uber, Meru).
5/ Are all 4 sources equal? 🧩
Absolutely not - Delhi Airport generates 36% of its total income from non-aeronautical source. Bigger the airport, higher will be this share.
What's next for airports? 💙
India's domestic air passenger traffic grew by 74% year over year if you compare last few months. Indian airlines are carrying peak 2.4 crore monthly passengers.
Airports = big cash flywheel 🎡
More passengers → More flights → Bigger airports → More retail space → more revenue → money to build more airports. That's all for now. Today morning, I had a seamless experience at Bangalore International Airport Ltd through DigiYatra, a Biometric enabled entry system (Aadhar verified). From entry to gate in less than 5 minutes though there was moderate rush.
If you are a frequent traveler, I strongly encourage you to use DigiYatra. It is currently available in Bengaluru, Delhi, Varanasi, Hyderabad, Kolkatta and couple of other airports. Though there were hiccups in the initial registration (e.g. first name and last name in Aadhar and tickets should be exactly the same), the entry process is quite seamless. There are enough help available at the DigiYatra counters to make your experience better.
DigiYatra, which is based on facial verification technology, is now available for passengers taking domestic flights at BLRAirport. It is our constant endeavor at Bangalore International Airport Ltd to offer innovative ways to simplify the passenger journey and make it as seamless as possible.
We were an important part of the first phase rollout of Digi Yatra Central Ecosystem (DYCE) which was successfully launched on August 15th this year. The current version of the App is available on both Android and ioS platforms.
DigiYatra Is aimed at offering a seamless, hassle-free and health-risk-free process for air travelers across airports in India. DYCE is being built on the standards defined by the World Wide Web Consortium (W3C) which include Self Sovereign Identity (SSI) with Verifiable Credentials (VCs), Decentralized Identifiers (DIDs) with a trust layer of a Distributed Ledger and ensuring adoption of Privacy by Design and Privacy by Default as the fundamental tenets. This ensures privacy issues are taken care of and passengers will not have to worry about sharing their data as it is secure and will be deleted after 24 hours following their travel.
DYCE is the initiative of the Digi Yatra Foundation (DYF) which was set up as a joint venture company in 2019, and BIAL is one of the key shareholders. The Digi Yatra Foundation will be a pan-India entity and the custodian of the Passenger ID validation process.
It has taken 5 years of persistence, patience and perseverance to make this radical transformation happen. Following an agile methodology, many more interesting and impactful features are planned in the next few months. This is just the beginning of an exciting digital transformation journey in air travel!
