Why Hosur airport plan won't be a walk in the park

The decision of the DMK government in Tamil Nadu to build a brand new airport in Hosur has opened up several new dimensions. This is not just because the nearby Bangalore International Airport (BIAL) promoters have cast in stone that no airport can be built within a 150 km radius. The distance between BIAL and Hosur is about 72 km.

There have been reports that the Tamil Nadu government might rope in the promoters of BIAL to build the airport in Hosur so that the 150-km radius condition can be circumvented. This might seem a smart move, but the local Karnataka government might then insist on reopening the HAL airport, especially for low-cost airlines, which are more than the full-service carriers, apart from the fact that the Karnataka government itself is seriously looking at setting up another airport close to Tumkur, which is situated in the northwest of Bangalore.

Massive investment needed

Over a decade ago, during the UPA II administration, when the DMK was in power in Tamil Nadu and had significant influence as a coalition member, it raised the issue of setting up an airport in Hosur. However, the plan did not move forward at that time, and now the same government has decided to renew efforts to set up the airport again. But it will need the Central government’s nod at every step, which might be difficult to come by as DMK is part of INDIA alliance, which sits in Opposition at the Centre where the NDA is the ruling coalition.

However, there is a possibility that Fairfax, which owns BIAL, might be keen on setting up another airport, as it has admitted that the Bangalore airport will run out of capacity by early 2030. At present, BIAL handles about 37 million passengers. BIAL expects annual traffic to grow beyond 50 million in FY’26 and surpass 60 million by FY’28. Newly constructed Terminal 2 of the airport, having an area of 2,55,645 sqm, will have 25 MPPA (million passengers per annum) designated capacity, taking the total designated capacity of T1+T2 terminals to 51.5 MPPA stretchable to 60 MPPA. There are plans to build Terminal 3, but it will need another runway, a bigger budget and more land.

“An airport cannot function in insolation. There has to be infrastructure built around it which involves connectivity, and the movement of road traffic. The Hosur road is already heavily congested and hence will need a lot more work with respect to road development and other necessary facilities,” Devesh Agarwal, an airline analyst, said. He pointed out that no airline has made BIAL a hub even after two decades of operations. At major hubs like Atlanta in the US, less than 10 per cent of passengers are origin and destination (O&D) passengers, whereas, in Bangalore, a higher proportion of passengers are O&D, impacting the actual passenger count and airport infrastructure needs. Also, for every 1 million passenger movement, an airport will require about 1,500 to 2,000 employees to commute from the city to the airport. Hence, they will need connectivity via roads and metros which will involve massive investment from the government.

Hence, establishing a second airport in Hosur comes with a myriad of challenges. These include,

1. Competition with Bangalore International Airport: Kempegowda International Airport (KIA) handled approximately 33.65 million passengers in the fiscal year 2022-2023. With over 60 airlines operating and a capacity to handle 55 million passengers annually, KIA is a major aviation hub. In contrast, a new airport in Hosur would need to attract a significant portion of this traffic to be viable. Bangalore's economic power as a tech hub, contributing around 35 per cent to India's IT exports, bolsters KIA's strong passenger base.

2. Infrastructure Development: Hosur lacks the necessary infrastructure to support a major airport. The city would need substantial investment in transportation links, including new roads, railways, and public transit systems. The estimated cost of developing a new airport with adequate infrastructure ranges from Rs 10,000 crore to 15,000 crore (USD 1.3 to 2 billion). This includes not only the airport facilities but also the necessary support infrastructure like hotels and maintenance facilities. The second terminal at Kempegowda International Airport alone cost around Rs 13,000 crore (USD 1.7 billion).

3. Regulatory and Administrative Hurdles: Navigating the regulatory landscape to establish a new airport can be complex. In India, airport projects typically require clearances from multiple agencies, including the Ministry of Civil Aviation, the Airports Authority of India (AAI), and state government bodies. Additionally, securing land acquisition approvals can be a significant hurdle. Land acquisition itself can be a lengthy and costly process, often involving negotiations with landowners and addressing legal disputes.

4. Economic Viability: Ensuring the economic viability of a new airport in Hosur would be challenging. The break-even passenger load for a new airport is generally around 5 million passengers annually. Given the proximity to Bangalore International Airport, achieving this figure might be complicated. Initial investments and operating costs need to be offset by steady passenger and cargo traffic.

5. Environmental Concerns: Building a new airport has significant environmental implications. Construction activities can lead to habitat disruption, loss of agricultural land, and other ecological impacts. For instance, the construction of the Navi Mumbai International Airport required the relocation of around 3,500 families and the diversion of two rivers. Managing noise pollution, air quality, and water resources will be crucial in ensuring sustainable development. Obtaining environmental clearances and conducting comprehensive ecological impact assessments (EIAs) would be necessary.

6. Community Impact: The establishment of a new airport can have mixed effects on local communities. While it can lead to economic development and job creation, it can also result in displacement and changes in land use patterns. In the case of the Navi Mumbai International Airport, over 2,000 hectares of land were acquired, affecting local communities significantly. Ensuring that the benefits of the new airport are equitably distributed among local populations and that negative impacts are mitigated will be essential for gaining community support.

Therefore, the DMK government's plan to establish a new airport in Hosur is ambitious but faces significant challenges. Navigating regulatory hurdles, developing necessary infrastructure, and competing with Bangalore International Airport make the path ahead complex. Success will require strategic collaboration, substantial investment, and meticulous planning to overcome the numerous obstacles and ensure the airport's viability and sustainability.