India's Ministry of Civil Aviation said that no existing policy prohibits airport operators from owning and operating their own airlines.
This development could reshape the Indian aviation landscape by allowing infrastructure owners to control the carriers that use their terminals. Such a move may influence market competition, regional connectivity, and how airport slots are allocated among competing airlines.
The government confirmed that the Airports Authority of India (AAI) has received a waiver request from the Adani Group [1]. The request seeks to relax specific contractual restrictions on cross-ownership that currently exist within airport concession rules [2].
"No policy bars airport operators from owning airlines," a Ministry of Civil Aviation spokesperson said [1].
Reports from late July indicate the Adani Group has approached the central government to change these rules to facilitate the launch of a new airline [2]. The group is seeking a modification of the terms under which it operates its airport concessions to allow for this vertical integration [2].
Government officials said that allowing airport operators to run airlines could potentially increase overall airline capacity [3]. Additionally, the move is viewed as a way to improve regional connectivity, and reduce market concentration by introducing new players into the flight operations sector [3].
The AAI and the Ministry of Civil Aviation are currently examining the request [1]. While the broad policy allows for such ownership, the specific contracts signed between the government and private operators often contain the restrictions that the Adani Group now wishes to waive [2].
“"No policy bars airport operators from owning airlines."”
The potential entry of the Adani Group into the airline business represents a shift toward vertical integration in India's aviation sector. If the waiver is granted, a single entity could control both the ground infrastructure and the air carriers, creating a strategic advantage in slot management and operational costs. This may prompt other airport operators to seek similar waivers, potentially consolidating power within a few large conglomerates while aiming to expand the country's overall flight capacity.
