Government Aims to Curb Market Concentration
The Indian Ministry of Civil Aviation (MoCA) is advancing a proposal to cap the number of airports that individual operators can manage across the country. This initiative, reported on August 24, 2026, stems from concerns regarding the 'oligopolistic nature' of India's civil aviation sector, where a few private players currently dominate operations.
Specifically, the MoCA highlighted that major entities like Adani Airport Holdings and GMR Airports collectively manage over half of India's total airport passenger traffic. The proposed cap seeks to mitigate risks associated with excessive market concentration and potential over-leveraging by concessionaires.
Upcoming Airport Auctions to Feature New Cap
The new policy is intended for implementation during the upcoming auction of 11 airports, which are slated to be privatized in bundles of two or three. This bundling strategy is designed to allow private concessionaires to utilize profits from high-traffic, revenue-generating airports to cross-subsidize the operational and capital expenses of smaller, less profitable facilities within the same bundle.
The Public Private Partnership Appraisal Committee (PPPAC) granted in-principle approval for the privatization of five such airport bundles during its 149th meeting on August 4, 2026. The Centre's plan is to award each bundle to a single concessionaire, with the cap preventing any one bidder from accumulating too many bundles.
Specific Airport Bundles Identified
- Amritsar-Kangra
- Varanasi-Gaya-Kushinagar
- Bhubaneswar-Hubballi
- Raipur-Aurangabad
- Tiruchirappalli-Tirupati
The bidding process for these bundles will involve a one-stage short-listing, with the per-passenger fee for domestic throughput serving as the primary bidding parameter.
Addressing Past Privatization Outcomes
This discussion follows a significant privatization drive in February 2019, where the Adani Group secured the rights to operate six major airports—Lucknow, Ahmedabad, Jaipur, Mangaluru, Thiruvananthapuram, and Guwahati—for a 50-year term after a competitive bidding process. The Ministry of Finance had previously raised concerns about market concentration during the PPPAC meeting, prompting the MoCA's commitment to finalize the capping modalities.
Current Landscape of Indian Aviation
Currently, the state-run Airports Authority of India (AAI) manages 129 airports. Adani Airport Holdings operates eight airports, handling approximately 24-25 percent of passenger traffic and 33 percent of air cargo. GMR Airports, responsible for key hubs like Delhi and Hyderabad, accounts for about 27.5 percent of passenger traffic. Together, these two private players manage over 50 percent of India's air passengers.
The airline market also exhibits a high degree of concentration, with IndiGo and the Tata Group-owned Air India Group collectively serving around 91 percent of domestic passengers as of July 2026. The specific details and final parameters of the proposed airport operator cap are still being finalized.