11 more airports may get privatised by the end of 2025-26

The privatization initiative aims to reduce the fiscal deficit, generate ₹47,000 crore from asset sales in 2025-26, and align with the National Monetisation Pipeline to unlock underutilized assets for funding infrastructure projects through private sector participation

In a significant move, the Centre is set to sell half a dozen loss-making airports by the end of the 2025-26 financial year, aiming to raise significant revenue and reduce fiscal deficits. The move, which will bundle unprofitable airports with more commercially viable ones, is part of the government’s ongoing efforts to privatize and modernize Indian airports. This marks the third phase of airport privatization, with a total of 11 airports up for sale under the public-private partnership (PPP) model.

The government has identified a mix of high-traffic airports, such as Varanasi, Bhubaneswar, Amritsar, and Trichy, alongside smaller, less profitable airports, for privatization. These 11 airports served approximately 13.5 million domestic passengers and 2.4 million international passengers in the nine months from January 25. Combined, they account for about 10% of India’s domestic air traffic and 4% of international traffic, underscoring their strategic importance to the national aviation network.

In a written reply to the Rajya Sabha on March 17, Minister of State for Civil Aviation Murlidhar Mohol confirmed that the selected airports will be grouped into pairs of profitable and underperforming airports. For example, the high-traffic Varanasi airport will be bundled with the less popular Gaya and Kushinagar airports, which have struggled to attract significant passenger traffic. Similarly, Bhubaneswar and Amritsar airports will be paired with Hubli and Kangra, while Raipur and Trichy will be linked with Aurangabad and Tirupati, respectively.

Unlocking airport potential for future growth

This privatization initiative is part of the government’s broader strategy to reduce its fiscal deficit and achieve a target of ₹47,000 crore in revenue from asset sales in the 2025-26 fiscal year. The sale of airports is also aligned with the National Monetisation Pipeline, which seeks to unlock the value of underutilized public assets to fund new infrastructure projects, with private sector participation. This effort is a key component of the government's airport development strategy, aiming to improve infrastructure and boost investment in Indian airports.

India’s aviation sector is growing rapidly, and the government’s initiative aims to accelerate the modernization of the country’s airport infrastructure. Currently, there are 159 operational airports in India, and 25 airports operated by the state-owned Airports Authority of India (AAI) have been earmarked for leasing under the National Monetisation Pipeline between 2022 and 2025.

Billionaire Gautam Adani’s Adani Group, which already controls several major airports, including those in Ahmedabad, Lucknow, and Mangalore, is expected to be a key contender in the airport privatization process. The group acquired six airports in the second phase of privatization and is likely to bid for additional airports in this latest round. Another potential bidder is GMR Airports Ltd., which operates New Delhi’s international airport, among others.

Transparent bidding for fair compensation

The government’s privatization strategy is designed to attract private capital to improve airport operations, efficiency, and customer service. The bidding process will focus on transparency, with bidders expected to offer the highest revenue-sharing proposals with the AAI, ensuring fair compensation for public assets.

However, the privatization plan is not without controversy. Delhi International Airport Limited (DIAL) has filed a petition with the Delhi High Court, challenging the government's decision to permit commercial flights from Ghaziabad's Hindon Airbase. DIAL argues that allowing commercial flights at Hindon could adversely affect the financial viability of Indira Gandhi International Airport (IGIA), which has been facing increasing operational costs. The court has issued a notice to the government in response to the petition.

Despite such challenges, the government remains committed to its airport privatization plans, believing they will help modernize the aviation sector, attract much-needed investments, and reduce the fiscal deficit. The divestment process for these 11 airports will move forward, with AAI expected to finalize the plan and seek government approval within the next month.