New Delhi, Feb 26 (PTI) As it awaits approval for higher tariffs after consultations, Delhi airport operator DIAL's equity is expected to erode in the current fiscal which is likely to push its borrowing costs higher.

DIAL, a consortium led by GMR Group, which has been operating the Indira Gandhi International Airport (IGIA) in the national capital since 2006 has incurred a cumulative loss of Rs 2,900 crore till December 31, 2024.

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With the present tariff proposal, "we might get into the black," DIAL CEO Videh Kumar Jaipuriar said on Wednesday.

In the tariff proposal for the fourth control period starting from April 1, 2024, to March 31, 2029, the operator has sought varying User Development Fee (UDF) for economy and business class passengers of international flights.

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The proposal has to be approved by the Airports Economic Regulatory Authority (AERA).

To a query from PTI about the alternative plan in case DIAL does not get what it has asked for, Jaipuriar said, "Not getting what I asked for. That is a difficult question".

"I am already sitting on debt in excess of Rs 14,000 crore and my equity is getting eroded... Majority part of the equity will get eroded this fiscal. In that case, it will be a challenge to raise more debt. If your rating suffers, then your interest rate goes up. It is a negative cycle".

For the current financial year ending March 31, 2025, the Delhi International Airport Ltd (DIAL) is projected to record a loss of more than Rs 1,500 crore.

At the end of December 2024, DIAL's outstanding debt was in excess of Rs 15,000 crore.

In a statement on Wednesday, the Association of Private Airport Operators (APAO) said Delhi airport has experienced substantial capital erosion over the years due to continued financial pressures.

"The existing aeronautical tariffs at IGI Airport, need to be revisited in line with the regulatory approach, as it does not reflect the development of large-scale infrastructure including the new Terminal 1, a fourth runway, and the Eastern Cross Taxiway amongst many others.

"Even with AERA's proposed 140% tariff revision, IGI Airport's charges will remain amongst the lowest in India and globally," APAO Secretary General Satyan Nayar said in the statement.

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