VZCZCXRO7294
OO RUEHAST RUEHBI RUEHCI RUEHDBU RUEHLH RUEHNEH RUEHPW
DE RUEHNE #0813/01 1131328
ZNR UUUUU ZZH
O 231328Z APR 09
FM AMEMBASSY NEW DELHI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6323
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHMO/AMEMBASSY MOSCOW 3348
RHEHAAA/WHITE HOUSE WASHDC
RUEAIIA/CIA WASHDC
RHEHNSC/NSC WASHDC
RUEIDN/DNI WASHINGTON DC
RHMFISS/HQ USCENTCOM MACDILL AFB FL
RHHMUNA/HQ USPACOM HONOLULU HI
RUEKJCS/JOINT STAFF WASHDC

UNCLAS SECTION 01 OF 02 NEW DELHI 000813 
 
SIPDIS 
 
FOR PM/ISO 
 
E.O. 12958: N/A 
TAGS: PREL MARR KMGT OTRA IN
SUBJECT: AVIATION FEES ISSUE IN INDIA: SEEK GUIDANCE FOR 
APRIL 30 DEADLINE FROM GOI 
 
REF: A. 2007 STATE 106799 
     ¶B. 2007 NEW DELHI 5376 
     ¶C. NEW DELHI 473 
     ¶D. HOLMES-POPE EMAIL 4/15/2009 
 
¶1. This is an action request for the Department.  Please see 
paragraph 3. 
 
¶2. Post appreciates the Department's guidance to date on the 
issue of aviation-related fees for official USG aircraft and 
understands an interagency process is currently underway to 
provide further guidance on a global policy.  However the 
issue has become a more urgent problem for us since the March 
6 diplomatic note (reftel C) received from the GOI rejecting 
reftel A's policy.  With the imposition of an April 30 
deadline (ref D), at which time Delhi International Airport 
Limited (DIAL), the private entity running commercial 
operations at Indira Gandhi International airport (IGI), 
states it "would not be able to extend credit for airport 
services being utilized by (the) U.S. Air Force at IGI 
Airport," Post feels the need to seek a solution which avoids 
the denial of services to USG aircraft by either the GOI or a 
commercial operator in India.  Post notes that outstanding 
bills incurred since August 2007's policy announcement 
(reftel A) from both government and non-government (i.e. 
commercial) service providers now total over USD 180,000, 
with approximately USD 80,000 coming from DIAL. 
 
¶3. Action request: After a thorough review of the history of 
this issue and what we believe is the intent of Reftel A 
guidance, post recommends the following way forward towards 
resolving this issue and to ensure future USG flights are not 
disrupted: 
 
¶A. Post requests permission to pay before the April 30 
deadline bills which in our view are payable under reftel A's 
guidance for landing and commercial side parking fees from 
DIAL and other commercial entities in India (Mumbai 
International Airport Ltd, New Bangalore Airport, New 
Hyderabad Airport, Cochin Airport).  An MEA contact suggested 
off-the-record to Poloff that should the Embassy pay up on 
past dues to DIAL, that would serve as a signal of our 
intention to resolve the longer-term issue and as a result, 
prevent any further action by the GOI or any other commercial 
provider throughout India. 
 
¶B.  Subsequent to this decision, we request guidance on what 
constitutes a "commercial" and/or "government" airport in 
cases where ownership and operations are mixed between public 
and private entities (for background, see paragraphs 4-5 
below). Concurrently or alternatively, we request 
guidance on whether to also pay bills from Indian Government 
agencies such as the Airports Authority of India, the Indian 
Air Force, and Hindustan Aeronautics Ltd. 
 
¶C.  As a next near step, Post recommends a team of policy and 
legal experts from Washington meet with Indian authorities on 
billing of aviation fees by commercial and government 
entities, for which payments fall under reftel policy. 
 
¶D.  Finally, post believes it in the USG interest to oppose 
the new Indian policy (reftel C) which said future USG 
flights would only be exempt from payment if "invited," and 
awaits guidance on this specific point.  End action request. 
 
¶4. Background.  The Airports Authority of India (AAI), 
working under the Ministry of Civil Aviation, manages all the 
126 airports in India.  In 2006, the GOI handed over India,s 
two most profitable airports - Delhi and Mumbai - to private 
companies to be modernized.  At present, the airports which 
have been privatized and managed by a private company include 
Cochin International Airport, Bengaluru International 
Airport, Indira Gandhi International Airport in Delhi, Rajiv 
Gandhi International Airport in Hyderabad, and Chhatrapati 
Shivaji International Airport in Mumbai.  Each of these 
airports is held by a private company and has a holding 
company established to manage day to day operations and 
airport business. For 
example, GMR Infrastructure Ltd has created Delhi 
International Airport Pvt Ltd (DIAL), a subsidiary of the 
company, for Delhi Airport. 
 
NEW DELHI 00000813  002 OF 002 
 
 
 
¶5. Background continued.  In India, airports may be owned by 
the Central Government, public sector undertakings (PSUs), 
state governments, urban local bodies, private companies and 
individuals, and also by joint ventures involving one or more 
of the above.  For example, Kolkata and Chennai airports are 
being modernized in a joint venture arrangement with the 
central government and a private company.  The GOI has 
focused on growth and liberalization of the aviation sector 
in India as an important link to develop India,s 
international economic and commercial competitiveness and its 
ability to attract 
foreign investment.  This focus has opened the door to 
private investment in the sector, especially in airport 
modernization projects and with new green field airports. 
During this transitory period of moving the sector towards 
greater liberalization, there are murky definitions within 
India of what types of airports are specifically classified 
as government airports.  Officially, India defines government 
airports as those managed by the military.  However, with 
increased growth in civil aviation, the GOI 
has worked to share air space for civilian and defense 
aircraft and there are over lapping functions and charges for 
air navigation fees at what otherwise would be classified as 
commercial airports. 
BURLEIGH