The Modi government’s airport privatisation plans could be hit if the move to restrict the sale of liquor in duty-free shops at airports is implemented, private airport operators association APAO said on Tuesday.

Any such restrictions would result in air ticket prices shooting up and the airports could incur a revenue loss of Rs 650 crore, including a Rs 330-crore loss to the Airports Authority of India, it said.

The move would also hit the airport privatisation plans of the government and hit investors’ confidence at a time the economy is expected to grow at an 11-year low of 5 per cent in the current fiscal. Bidders had put in their bids keeping in mind certain estimates from the non-aeronautical revenue segment, the association said. In the changed circumstances, the new operators such as Adani Group and Zurich Airport may find the airports unviable and may even “renege on their contracts”.

While Zurich Airport has been awarded the contract to build, operate and develop the second airport of Delhi-NCR at Jewar, Adani Group has won the bid to operate and develop six airports of Jaipur, Lucknow, Guwahati, Trivandrum, Ahmedabad and Mangalore.

As passenger charges alone are never enough to fund the cost of developing and operating airports, operators depend on non-aeronautical revenue to subsidise these costs. At most airports, duty-free revenues make up 15-20 per cent of the total non-aeronautical revenues and sales of liquor and cigarettes together account for over 75-80 per cent of overall duty-free sales.