Daijiworld Media Network – Mangalore (NR)
Source: Livemint.com
New Delhi, Mar 24: Civil Aviation Ministry is planning on putting a cap and restricting private developers from bidding for not more than two non-metro airports. This is being done with a view to avoiding creation of new monopolies in the booming airport construction and modernization business, sources within the aviation ministry informed.
Over the next two years contracts for modernization of two dozen non-metro airports across India will be opened for bidders. It is estimated that India needs some Rs 1,600 crore private investment at 35 non-metro airports, many of which have seen traffic swelling over the past three years as more low-fare airlines and international carriers have entered the market.
Some of the private entities vying for business at the non-metro airports are GVK Power & Infrastructure Ltd, Reliance Anil Dhirubhai Ambani Group’s Reliance Energy Ltd, GMR Infrastructure Ltd, Tata Realty & Infrastructure Ltd, L&T Infrastructure Ltd, Unitech Ltd, Omaxe Ltd, Ansal Properties & Infrastructure Ltd and others.
There will be a selection process within next three months, whereby the ministry will shortlist five companies, which will then be asked to submit a financial bid before the final selection. Since the criterion for selection is based on set patterns and parameters, it is possible for the same developers, if they apply, to be short listed among the top five each time the government seeks a proposal for the remaining 22 airports.
A senior government official within the aviation sector, on the condition of anonymity confided that the ministry is planning to restrict operators from bidding for other airports if they have already won contracts for two airports. A developer may be allowed to bid for more airports only after meeting project deadlines on the first two projects as stipulated by the government, he added.
Clarifying and elaborating on the matter, he informed that this means that a few shall not get too much of work. For instance, if someone has 10 airports to develop, work will most likely suffer. It may also not be completed in a time-bound manner.
However, he did reveal that the new rules would not apply to metro airports. Meanwhile there are also voices of scepticism to this forthcoming new stricture. For instance Robey Lal, a private consultant, ex member of operations at the Airport Authority of India (AAI) states “You can get out of the loop by forming a different company. Just two airports without reasoning seems hasty.” he criticised.
The Airport Authority (AAI) which is a combined entity of a airports' regulator cum an entity through which the government owns stakes in airfields in the country, is on a modernization spree. It is upgrading 35 non-metro airports at a cost of Rs 5,500 crore (approx). However, the ministry wants the development of terminals, cargo complexes, airport hotels, parking bays, and malls—collectively called city-side development — at 24 of these airports (including Mangalore city) to be done with private players assistance, through what is generally dubbed as public-private partnership (PPP) models.
Mangalore city's airport is one such non-metro city to be developed using the PPP model in addition to other 23 non-metros in the country like Amritsar, Udaipur, Tiruchirappalli and Visakhapatnam among other airports in the country. With regard to the ministry's latest plans impacting private bidders business dealings, one well known realty and infrastructure senior executive rued that they were kind of losing interest, since they were waiting for months for concrete plans on airport contracts to materialise. Last minute changes are made to plans, we need to see signs that they are serious, he demanded. However the aviation ministry on its part is doing its spade work on all non-metro airports modernization, with now some specific and concrete plans to materialise in the near future.