Adani airline plans: Why the Centre may ease airport-airline ownership rules | Explained
The story so far: The Ministry of Civil Aviation is examining whether to relax cross-ownership restrictions between airport operators and airlines. Officials are preparing a
The story so far: The Ministry of Civil Aviation is examining whether to relax cross-ownership restrictions between airport operators and airlines. Officials are preparing a concept note for consultations with NITI Aayog and other government ministries before any proposal is taken to the Union Cabinet. The exercise comes amid media reports, citing a letter from Adani Airports CEO Arun Bansal, that the proposed changes are linked to the Adani Group’s reported interest in entering the airline business. However, Adani Enterprises denied the reports. What is the government proposing? The restrictions under review are embedded in airport concession agreements rather than in legislation. The concession agreements for Delhi and Mumbai airports cap aggregate airline ownership in the airport operator at 10%, while those for the Noida International Airport (Jewar) and Navi Mumbai airports are more relaxed and allow up to 26% ownership in an airline. These provisions can also be applied in reverse, effectively restricting airport operators from acquiring significant stakes in airlines. Media reports suggest that the government is interested in this ostensibly to allow new airline entrants, increase investment in the sector and help break the near-duopoly of IndiGo and the Air India group in the domestic market.
These suggestions come in the backdrop of IndiGo’s large scale flight cancellations in December 2025 over pilot rostering issues that brought air travel to its knees. Some media reports have also linked the proposed changes to the Adani Group’s reported interest in entering the airline business, citing its memorandum of understanding (MoU) with Brazilian aircraft manufacturer Embraer to explore local production of passenger aircraft. Embraer has said that setting up a final assembly line (FAL) in India would depend on securing a substantial aircraft order from the country. How will the government address conflict-of-interest concerns? The current concession agreements maintain a separation between airport operators and airlines to prevent potential conflicts of interest by ensuring airports remain neutral infrastructure providers and do not favour affiliated carriers in gate allocation, terminal access, airport facilities or other operational decisions. Government officials say any relaxation of the rules is likely to be accompanied by safeguards to ensure an “arm’s length” relationship between airport and airline businesses. Among the measures under consideration are provisions preventing the direct or indirect sharing of commercially sensitive information, including data relating to slot allocation and airport operations. The proposal is also expected to prohibit common key managerial personnel from holding executive positions in both the airport and airline entities.
The BriefWire