The Government of India has proposed privatising 11 Airports Authority of India (AAI) airports through five public-private partnership (PPP) bundles, with private concessionaires to operate, manage and develop the airports across Amritsar, Kangra, Varanasi, Gaya, Kushinagar, Bhubaneswar, Hubballi, Raipur, Aurangabad, Tiruchirappalli and Tirupati.

The bundling approach is intended to use revenues generated by larger airports to support smaller airports, helping ensure their long-term financial sustainability. The five proposed airport bundles are Amritsar–Kangra-Gaggal; Varanasi–Gaya–Kushinagar; Bhubaneswar–Hubballi; Raipur–Aurangabad; and Tiruchirappalli–Tirupati. Central-sector PPP projects with an estimated cost exceeding ₹250 crore (US$26.2 million) are required to undergo appraisal by the Public-Private Partnership Appraisal Committee (PPPAC).

The committee has granted in-principle approval to the Civil Aviation Ministry’s proposal to bundle the airports and award each group to a single private concessionaire under the PPP model, to develop world-class airport infrastructure. Earlier, in 2018–19, the government had privatised six AAI-operated airports through the PPP route. The Adani Group secured the contracts for all six airports—Ahmedabad, Lucknow, Mangaluru, Jaipur, Thiruvananthapuram and Guwahati.

The Civil Aviation Ministry stated that it would limit the number of airport bundles that can be awarded to a single bidder to reduce risks associated with market concentration and excessive leverage, including the possibility of financial stress spreading across multiple projects. The ministry assessed 12 major airports using factors such as passenger traffic, land availability, commercial potential, financial performance, and airport-specific opportunities and constraints, with six airports ultimately recommended for leasing. It then evaluated 136 smaller airports for potential pairing with the major airports, considering factors including traffic prospects, capital expenditure needs, geographic proximity, city-side development opportunities, and financial viability.

The private concessionaire will oversee the operation, management and development of the airports, including passenger terminals and city-side facilities, under a 50-year concession. Meanwhile, AAI Cargo Logistics and Allied Services Company Ltd (AAICLAS), a wholly owned subsidiary of AAI, will continue to manage cargo operations. The proposal also includes a one-year joint management period with existing AAI employees, following which the private concessionaire will be required to retain 60% of the AAI workforce for up to three years.