₹1 lakh. The sector has also sought categorization of airports under priority-sector lending.
“Airport construction requires huge investment and a long gestation period. A short period of loan availability coupled with a high interest rate results in a huge financial cost and cash flow mismatch for airport operations.
Categorization of loans to airports under priority-sector lending is needed to reduce overall finance cost for such large infrastructure projects," read the APAO request. Currently, loans provided by institutions for airport construction are classified under the general category, which leads to shorter repayment tenure of 10-14 years with a high interest rate.
Inclusion in the priority sector would change that to a longer repayment period of up to 20 years and lower interest rates as well. Notably, these recommendations have been made at a time when the country’s travel retail market is set to grow by about 22% from $1.67 billion in 2023 to $4.43 billion in 2028, according to estimates by Mordor Intelligence.. Read more on livemint.com