A proposal by Bengaluru International Airport Ltd (BIAL) to reduce airfares for passengers who fly out from the airport is expected to come to fruition soon if it gets regulatory approval. To help sustain passenger growth and ensure the financial sustainability of the airport's investments, the airport operator has proposed a substantial cut in User Development Fees (UDF) for departing passengers from 1 September 2026.
Key Highlights
- Bengaluru Airport proposes lower UDF charges, potentially reducing airfare costs for departing passengers.
- BIAL plans Rs 18,635 crore expansion while balancing passenger affordability through revised tariffs.
The proposal has been presented to the Airports Economic Regulatory Authority (AERA) in the Airport's tariff plan for the upcoming control period.
Proposed UDF Reduction for Domestic and International Flyers
The UDF for domestic travellers will be slashed to Rs 1,450 from Rs 1,550, and that of international passengers to Rs 1,215 from Rs 1,500 under the proposal. The new rates are recommended to apply from September 2026 and until March 2029.
BIAL has also indicated that domestic UDF will be further reduced from April 2029 onwards to Rs 1,245 and international UDF to Rs 1,050. The reduction in UDF will directly reduce the total ticket cost paid by the departing air traveller as it forms part of the overall airfare.
All passengers coming into the country will continue to be exempted from paying UDF.
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Airport Seeks to Balance Growth and Expansion Costs
BIAL believes that reducing passenger fares in the short-term will avoid an immediate negative impact on traffic and could help maintain growth.
In FY26, Kempegowda International Airport served 44.16 million passengers, it is India's third busiest airport after Delhi and Mumbai. The operator has mapped capital expenditure plan of Rs 18,635 crore to boost its capacity and make Bengaluru a key aviation hub in the country.
The airport explained the temporary lower fees would make it easier to lower and increase taxes in the future based on infrastructure commissioning and investment recovery.
Bengaluru Could Become One of India’s Lowest-Charging Metro Airports
The suggested lower rate may cause Bengaluru to become one of the lowest rates for UDF for customers departing from private metro airports across the country, industry sources believe, though some airports like Delhi or Mumbai may have lower UDF rates. AERA approved similar UDF rates at other airports, such as Rs 490 for the domestic travelling passengers at Noida International Airport and Rs 620 at Navi Mumbai International Airport.
The proposal comes as the airports in India are pushing for expansion of their infrastructure while still maintaining competitiveness in passenger fares.
Ownership and Future Outlook
Bengaluru International Airport Ltd is an airport company managed by a consortium headed by Fairfax Financial Holdings with 74% stake in the company held by their Mauritius subsidiary, FIH Mauritius. The rest of the shares are held by Karnataka State Industrial Infrastructure Development Corporation (KSI IDC) (13%) and the Airports Authority of India (AIRIN, 13%).
The revised UDF structure will be finalized based on AERA's review of BIAL's tariff submission. From September 2026, the Bengaluru flyers may start enjoying reduced fare levies for flights.
