Adani Group, the country’s largest private airport operator, has approached the government for relaxation of norms, paving its foray into the airline sector. If allowed, it could end IndiGo and Air India’s duopoly in India’s aviation market. The government has proposed a policy to allow airport operators to own and run airlines.
According to the Economic Times, the Adani Group wants the government to amend an existing clause that prevents airport operators of Delhi and Mumbai from holding more than 10% stock in a scheduled airline. It further says the move is to capitalise on its deal with Embraer for making aircraft in India. GMR Group, which operates Delhi airport, also comes under this legal clause.
The Adani Group has several times in the past said that they are not interested in airline business as it doesn’t fit their capital discipline. Jeet Adani, Director at Adani Airport Holdings Ltd (AAHL), himself has denied a foray into airline business but with a rider.
“I would say that there is nothing that we won’t consider. However, legally we are not allowed,” he had told reporters before the launch of Navi Mumbai airport in December 2025.
According to the sources in the civil aviation ministry, the issue has been under discussion informally because the aviation market has evolved significantly since these concession agreements were drafted two decades ago.
“There is no formal proposal before the government. These are preliminary discussions at best. If amended, the government may still cap the airport operators to have a shareholding in limited capacity,” said the sources.
Adani’s airport business
Adani runs eight airports, including Navi Mumbai and Mumbai, while GMR Group has five airports, including Delhi and Hyderabad. Adani also manages airport lounges and has recently announced Rs 20,000 crore in the first phase of developing integrated airport cities across six airports in India.
The Adani Airport Holdings Ltd (AAHL) aero and non-aero revenue delivered robust YoY growth of 26% and 31% respectively in FY26.
However, it decided to stay away from the airline business for obvious reasons. In the last few years, several big airlines, including Jet, Kingfisher and Go Air, have collapsed in India due to cut-throat competition and razor-thin margins.
“We will not consider it as it stands today; the airline industry is not something that we see fitting the capital discipline. We are used to high-margin business and investing in assets and using our assets well. The airline business in opposite. We have no plans to enter the airline business,” said Adani.
Both IndiGo and Air India have posted losses in FY26, owing to various reasons including high ATF prices, high dollar against rupee and geopolitical turmoil.
Way forward
According to a report in Bloomberg, the Ministry of Civil Aviation is discussing the proposal, which would need legal approval from the law ministry and the Union Cabinet led by Prime Minister Narendra Modi.
AAI (Airports Authority of India), which is the grantor of the concessions for Delhi and Mumbai, would negotiate and execute a supplemental agreement/amendment to the OMDA (Operation, Management and Development Agreement) with the airport operator (DIAL and MIAL)
The amendment would need legal vetting by the Ministry of Law & Justice because it changes contractual rights and obligations under long-term PPP agreements.
Depending on the nature of the change, it may require approval from the Cabinet or the Cabinet Committee on Economic Affairs (CCEA), particularly if it is considered a material change in PPP policy or concession terms.
