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According to a report by Knight Frank India and NAREDCO, aerocities surrounding major Indian airports are set to become strong economic hubs. With air passenger numbers expected to rise further, non-aeronautical revenues from retail, hospitality, and leasing could touch USD 29.5 bn annually, up 26 percent from current levels. Airports developed under the PPP model already account for the majority of such income, and hubs like Delhi and Mumbai are matching international benchmarks in per-passenger earnings. Aerocities are now viewed as long-term growth engines, offering stable income, real estate development, and increased global connectivity.
India's airports are preparing for a sharp increase in passenger numbers, which is expected to change the way they operate. They are steadily evolving into large economic hubs that combine aviation with retail, hospitality, real estate, and other services. This model, known as the aerocity, is being recognised as a significant opportunity for future growth. Advertisement
A detailed study conducted by Knight Frank India in association with the National Real Estate Development Council (NAREDCO) has projected that aerocities could generate USD 29.5 bn in non-aeronautical revenues annually by 2030. This would be a 26 percent increase compared to current figures. The study explained that even a small rise of just USD 1 (INR 87) in per-passenger spending could add considerably to the revenue pool, supported by higher air traffic volumes.
The report underlined that aerocities will attract growing investment in retail outlets, food and beverage options, hotels, entertainment, and destination-based services. These facilities are not only designed for travellers but also for residents and local visitors, making airports active centres of commerce rather than only travel points.
The growth is being driven largely by the PPP (public-private partnership) airports, which already generate 87 percent of non-aeronautical revenue while handling about 64 percent of passenger traffic. The report noted that this model has encouraged large-scale private investment, giving operators the flexibility to create sustainable revenue streams.
Aerocities are planned as mixed-use districts with offices, convention centres, logistics hubs, retail and leisure areas, and hotels. They are expected to support urban growth by creating jobs, boosting tourism, and strengthening international connectivity. This structure is intended to make airports reliable economic contributors beyond the aviation business alone.
Industry leaders have also shared their views on this development. The president of NAREDCO said that aerocities could generate significant non-aeronautical revenues and help create business districts with strong hospitality and commercial infrastructure. Similarly, Knight Frank India's chairman observed that airports such as Delhi and Mumbai are already setting examples by developing integrated zones that rival global benchmarks.
Data presented in the report shows that Mumbai earns USD 20.1 per passenger and Delhi earns USD 18.1, which are close to London Heathrow at USD 21.6 and Tokyo Haneda at USD 19.9. This indicates that India's top airports are already aligning with international standards, and are becoming attractive to global retail and hospitality brands.
The report added that further interest is expected from institutional and private equity investors. With strong fundamentals in place, aerocities are positioned to become the next stage of airport development in India, ensuring stable income for operators, improved facilities for travellers, and wider economic benefits for cities and states.
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