Bengaluru Airport UDF Cut: Domestic Fee Set at Rs 300, International at Rs 997

The Airports Economic Regulatory Authority of India (AERA) has sharply reduced the User Development Fee (UDF) at Bengaluru’s Kempegowda International Airport, setting it at Rs 300 for departing domestic passengers and Rs 997 for departing international passengers for the five-year control period ending March 2031.

The revised rates, effective from September 1, 2026, are aimed at making air travel more affordable while preventing passengers and airlines from bearing costs for infrastructure that is not yet operational. Domestic UDF has been reduced from Rs 550 to Rs 300, while the international fee falls from Rs 1,500 to Rs 997.

The key reason behind the reduction is AERA’s introduction of the incremental Average Revenue Requirement (ARR) framework. Instead of recovering the cost of major capital projects from the first year of the control period, the regulator will allow BIAL to recover those costs only after the projects are completed, commissioned and made available to users.

AERA also rejected BIAL’s proposed baseline ARR of Rs 41,398.93 crore, approving only Rs 14,604.31 crore. The regulator’s lower assessment reflects its decision to defer recovery of high-value projects, including the ECT, T2 Phase 2 terminal and T2 Phase 2 apron, until their actual commissioning. This reduces the risk of over-recovery if projects are delayed, deferred or not executed.

For airlines, the lower tariff structure should reduce airport-related operating costs, particularly for carriers with significant Bengaluru operations. AERA has also rationalised landing charges to Rs 442 per MT for domestic flights and Rs 652 per MT for international flights.

Passengers, meanwhile, will benefit directly from lower departing UDF. About 84% of Bengaluru airport’s traffic is domestic, making the reduction particularly significant for the majority of travellers.

BIAL said the revised structure will apply until August 2029, after which tariffs may be modified based on project completion. It added that UDF will now be shared between arriving and departing passengers. Including the arriving charge, the combined domestic UDF will be Rs 425, compared with Rs 550 currently, while the combined international fee will be Rs 1,423 against Rs 1,500 earlier.