IndiGo CEO Willie Walsh has called for lower airport charges and aviation taxes, arguing that India’s aviation market could grow faster if airlines faced a more competitive cost structure. Speaking at his first in-person media briefing since taking charge as CEO in August 2026, Walsh said airport charges were too high and that airports needed to offer better value to airlines.
His comments come as Indian carriers face pressure from elevated aviation turbine fuel (ATF) prices, currency depreciation and international airspace disruptions. IndiGo reported a net loss of ₹1,879.1 crore for the September 2026 quarter, with higher fuel costs among the major pressures on profitability. Walsh said the airline sees significant opportunities in India but stressed that all stakeholders must focus on controlling operating costs.
IndiGo CEO Calls Airport Charges Too High
Walsh said Indian airports should become more competitive in their pricing, particularly because major airports often operate as effective monopolies in their respective markets.
He said IndiGo would continue seeking better value from airport operators and reiterated his longstanding criticism of India’s airport charges and aviation taxes.
“Airport charges are too high and so this market would do much better if we had lower taxes. So lower taxes, lower airport charges, that is the way forward,” Walsh said, according to the Financial Express report.
The CEO also argued that airlines, airport operators and the government need to work together to improve the industry’s cost structure.
His comments are significant because airport-related expenses affect airline operating costs and can influence the economics of adding new routes, increasing flight frequencies and expanding into smaller markets.
What Airport Charges Do Indian Airlines Pay?
Airlines pay airports several charges for using airport infrastructure and services. These include landing charges, parking charges and other aeronautical fees.
The Airports Economic Regulatory Authority of India (AERA) regulates aeronautical tariffs at major airports. It determines charges after considering factors such as operating expenditure, depreciation, taxes and returns on airport infrastructure investments.
Some important charges include:
| Charge | What it covers |
|---|---|
| Landing charges | Fees paid by airlines for aircraft landing at an airport |
| Parking charges | Fees for keeping aircraft parked at airport facilities |
| User Development Fee (UDF) | A passenger charge collected to support airport development and infrastructure costs |
| Passenger Service Fee (PSF) | A passenger charge used for airport security and passenger facilities |
It is important to distinguish between charges paid directly by airlines and fees collected from passengers through ticket prices. Landing and parking charges are airline operating expenses, while UDF and PSF are generally collected from passengers and remitted to the relevant airport or service provider.
The amount charged can vary across airports depending on their tariff structure, regulatory decisions and operating arrangements.
Why IndiGo Wants Lower Aviation Taxes
Aviation turbine fuel is one of the largest expenses for airlines. It accounts for approximately 40% of airline operating costs, making changes in fuel prices particularly important for profitability.
In India, ATF is subject to state-level value-added tax (VAT), with rates differing across states. High VAT can make refuelling more expensive at certain airports and influence where airlines choose to purchase fuel.
The Ministry of Civil Aviation has previously asked states and Union Territories to reduce ATF VAT. In a March 2025 parliamentary response, the government said 19 states and Union Territories had reduced VAT following its requests. It also said the ministry had taken up the possibility of bringing ATF under the GST regime with the Ministry of Finance, with a final decision resting with the GST Council.
Tamil Nadu recently announced another change. From November 1, 2026, scheduled airlines refuelling at Chennai airport became subject to 16% VAT on ATF, down from 29%. The rate at other airports in the state was reduced to 1%.
Such differences in fuel taxation can influence airline costs and airport-level competition. Lower taxes could improve the economics of operating routes, particularly where airlines have limited flexibility to pass higher expenses on to passengers.
Rising Fuel Costs Put Pressure on IndiGo’s Profitability
Walsh’s comments come during a challenging period for the airline industry.
IndiGo’s parent company, InterGlobe Aviation, reported a net loss of ₹1,879.1 crore for the quarter ended September 30, 2026. Higher fuel costs and rupee depreciation affected profitability.
The airline has also faced longer flying routes and operational complications because of geopolitical developments and restrictions affecting international airspace.
Walsh said jet fuel prices could remain elevated in the near term, partly because of a higher premium for aviation fuel compared with crude oil. He indicated that the airline would continue managing its operations and costs while navigating the difficult environment.
For airlines, higher fuel bills can create pressure on margins when ticket prices cannot be increased by the same amount. Carriers must balance operating costs against passenger demand, particularly in a price-sensitive market such as India.
The cost pressure also makes airport charges and taxes more important to airline management because they are among the expenses that can potentially be addressed through regulatory or policy changes.
Government Had Earlier Cut Landing and Parking Charges
The government has previously introduced temporary relief for domestic airlines.
On April 8, 2026, the Ministry of Civil Aviation announced a 25% reduction in landing and parking charges for domestic flights at major airports under AERA’s jurisdiction. The measure also covered non-major airports operated by the Airports Authority of India (AAI).
The reduction was announced for three months and was expected to lower landing and parking charges payable by airlines at major airports by approximately ₹400 crore during the period.
The government introduced the measure amid a sharp rise in global aviation fuel prices linked to the West Asia crisis.
The temporary relief period has since elapsed. Walsh’s latest comments indicate that IndiGo wants a more sustained improvement in the cost environment rather than relying only on short-term interventions.
However, airport operators have also raised concerns about reductions in their charges. In April 2026, the Association of Private Airport Operators argued that lower landing and parking charges could affect airport revenues and investment incentives. It also said there was no enforceable mechanism to ensure that savings for airlines would automatically be passed on to passengers through lower fares.
This highlights the challenge for policymakers: reducing airline costs while maintaining the financial viability of airport infrastructure.
IndiGo Operates More Than 2,100 Flights Daily
Despite the cost pressures, IndiGo continues to expand its operations and remains India’s largest airline by domestic market share.
The airline operates more than 2,100 flights daily and has an operational fleet of over 400 aircraft.
Walsh said India offers significant opportunities for further aviation growth. He also highlighted the potential of Navi Mumbai airport, which could provide additional capacity for domestic and international operations.
The airline is preparing for a larger international presence through the planned introduction of wide-body aircraft. Walsh said IndiGo expects to begin receiving Airbus A350 aircraft from the second quarter of 2028.
The A350 fleet is expected to support the airline’s long-haul ambitions and provide access to markets that require aircraft with greater range and capacity than its existing narrow-body fleet.
Can Lower Taxes and Airport Charges Make Air Travel Cheaper?
Lower taxes and airport charges could reduce some of the expenses incurred by airlines. However, the extent to which these savings translate into cheaper tickets will depend on market conditions.
Airfares are influenced by several factors, including fuel prices, passenger demand, competition, aircraft utilisation, currency movements and operating costs.
Airlines may use lower costs to improve profitability, maintain competitive fares or support expansion. There is no automatic guarantee that every reduction in airport charges or fuel taxes will be passed directly to passengers.
The impact may also differ between routes. Airlines operating in highly competitive markets may face greater pressure to offer lower fares, while routes with limited competition may respond differently.
For the government, the challenge is to balance affordable air travel with tax revenues, airport investment and the long-term development of aviation infrastructure.
The Bigger Picture
Walsh’s comments highlight a structural issue in India’s aviation industry: passenger demand and airline expansion depend not only on aircraft availability but also on the overall cost of operating flights. Fuel taxation, airport tariffs, infrastructure charges and currency movements all influence the economics of air travel.
India is developing new airports and expanding aviation connectivity, but those investments need to remain financially sustainable. A more predictable and competitive cost structure could help airlines plan routes and capacity over longer periods. At the same time, airport operators need sufficient revenue to maintain infrastructure and fund future development.
Looking Ahead
IndiGo will continue monitoring fuel prices, airport charges and international operating conditions as it plans its domestic and international expansion. The expected arrival of A350 aircraft from 2028 is another important part of its longer-term strategy. Whether lower taxes and airport charges become a policy priority will depend on discussions between airlines, airport operators, regulators and the government.
For passengers, the key question is whether any future cost reductions translate into more affordable fares and additional flight options. Walsh’s remarks have renewed the industry’s call for changes, but meaningful results will depend on policy decisions and how airlines and airport operators respond.
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