With market liberalisation, established airports have regularly faced greater uncertainties regarding their planned investments. However, airport authorities as well as private stakeholders (through international consortia) continue to invest in ever larger and more capital-intensive infrastructures. Major uncertainties arise regarding these long-term investments since traffic forecasts have a legacy of being grossly inaccurate. In contrast to such practice, both literature and empirical evidence suggest that airport development should be undertaken in incremental steps, avoiding over-commitment of funds and being able to adapt to a changed environment, including altered patterns of competition. This paper highlights scenarios that characterise paths of airport development in India. A decision-tree analysis provides a helpful tool to identify those paths for airport development that will minimise uncertainty and prove more effective in fostering robust and efficient growth for the Indian air traffic system as a whole.
