New Delhi: Legal changes to enable housing development in airport land are in the works, the chairman of India’s state-run airport development authority said. Currently, airport housing in India is permitted only for airport employees.

The Airports Authority of India (AAI), which operates 125 airports, has a land bank of 55,800 acres, which has so far been used only for aviation and passenger-related activities.

That will change soon.

“We want to make it market-driven,” AAI chairman Guruprasad Mohapatra said in an interview.

The Union aviation ministry will soon move a cabinet note to amend the law governing AAI to permit use of airport land for housing and other areas which are currently not allowed, Mohapatra added.  

“Housing is an attractive thing to develop in and around airports. Currently, you can’t develop housing as part of the land restriction,” he said.

As cities have grown, Mohapatra said, they have reached the fringes of airports, which were once far from the city centres. “Urban housing is now a requirement. Housing close to the airport receives the most premium—you see advertisements saying 20km from the airport and so on.”

Mohapatra said prime housing may not be required in very small towns, but in places where land is very expensive, there could be very strong demand.

Once the legal changes are through, airports could also use the available land to build malls and convention centres, among others.

Like mass housing, airports are currently not allowed to build convention halls, Mohaptra said. "That probably is a requirement in many cities now. India is hosting many conventions now,” he said, adding AAI would survey each city and based on the demand, decide what would fetch the best price for its land, which will be leased out accordingly.