By BizAndhra Bureau
The upcoming Alluri Sitarama Raju International Airport at Bhogapuram, poised to become Andhra Pradesh’s premier international aviation hub, is attracting attention for more than its world-class infrastructure. The User Development Fee (UDF) approved for the airport has triggered widespread debate, with industry observers, travellers and opposition parties questioning whether the charges could make flying to and from North Andhra significantly more expensive.
While the state government and airport developer GMR argue that the airport will transform the region’s connectivity and economic prospects, critics contend that the relatively high UDF could discourage passengers and affect the competitiveness of the new facility.
What is UDF?
The User Development Fee is a charge levied on airline passengers to help airport operators recover part of the capital invested in developing airport infrastructure. The fee is collected by airlines as part of the ticket price and remitted to the airport operator.
For greenfield airports, where developers invest thousands of crores before operations begin, regulators often permit higher UDFs during the initial years to facilitate cost recovery.
Bhogapuram’s Approved UDF
The Airports Economic Regulatory Authority (AERA) has approved the following ad hoc passenger charges for Bhogapuram Airport:
| Passenger Category | UDF |
| Domestic Departure | ₹835 |
| Domestic Arrival | ₹355 |
| International Departure | ₹1,255 |
| International Arrival | ₹545 |
These charges will come into effect from the date commercial operations commence at the airport and will remain applicable until AERA determines regular tariffs for the first control period.
How Does It Compare?
The biggest concern centres on the ₹835 UDF for departing domestic passengers, which is among the highest charged at major Indian airports.
While airports such as Delhi, Mumbai, Bengaluru, Hyderabad and Noida also levy passenger development fees, Bhogapuram’s domestic departure charge exceeds several established airports.
Industry experts note that this additional cost will be reflected in the final airfare, particularly affecting budget travellers flying on low-cost carriers.
For a family of four travelling from Bhogapuram, the UDF alone could add ₹3,340 to the ticket bill before taxes.
Why Are the Charges High?
Bhogapuram is a greenfield international airport being developed by GMR Visakhapatnam International Airport Ltd. with an initial passenger handling capacity of around 6 million passengers annually.
Unlike older airports where infrastructure has already been amortised over decades, new airports require recovery of substantial upfront investments in:
- Runways
- Passenger terminals
- Air traffic infrastructure
- Utilities
- Roads and connectivity
- Safety and security systems
AERA has observed that these investments justify higher initial tariffs during the early operational years.
Critics Raise Concerns
The proposed charges have drawn criticism from political parties and frequent flyers.
Opponents argue that North Andhra travellers are being asked to bear a disproportionate financial burden simply because they will use a newly built airport.
Travel industry stakeholders also fear that higher passenger charges could:
- Increase the overall cost of travel.
- Reduce demand on price-sensitive domestic routes.
- Affect tourism and business travel.
- Place Bhogapuram at a competitive disadvantage compared to neighbouring airports.
Some analysts believe airlines may find it more difficult to stimulate passenger demand on new routes if ticket prices rise due to airport charges.
Government’s Position
The Andhra Pradesh government maintains that Bhogapuram Airport represents a long-term investment in the state’s economic future.
The airport is expected to replace civilian operations at the existing Visakhapatnam Airport, which currently functions as a civil enclave within the Indian Navy’s INS Dega and faces operational constraints on expansion. The new airport is designed to accommodate significantly higher passenger traffic and support international connectivity, cargo operations and future aviation-related industries.
Officials argue that the improved infrastructure, enhanced passenger experience and greater airline capacity will outweigh the higher UDF over time.
Temporary Tariff
AERA has clarified that the approved UDF constitutes an ad hoc tariff, not the final long-term pricing framework. Once the airport begins commercial operations and actual traffic data becomes available, the regulator will undertake a detailed tariff review for the first control period.
This leaves open the possibility that passenger charges could be revised in the future based on traffic volumes, revenue generation and operational costs.
The Road Ahead
Bhogapuram Airport is expected to become a major aviation gateway for Andhra Pradesh, with the potential to boost tourism, exports, logistics and investments across North Andhra.
However, its success will ultimately depend not only on modern infrastructure but also on maintaining affordable air travel. Whether the higher UDF proves to be a temporary necessity or a long-term burden for passengers will become clearer once commercial operations begin and traffic patterns stabilise.