Chandigarh, Dec 20 (IANS): The Punjab government on Thursday signed a Memorandum of Understanding with the Airports Authority of India (AAI) for setting up a new Civil International Air Terminal at Indian Air Force station at Halwara, near Ludhiana.

The MoU was signed by Punjab's Secretary Civil Aviation Tejveer Singh on behalf of the state government and Executive Director G.D. Gupta, on behalf of AAI.

Giving details of the MoU, an official spokesperson said the project would be implemented through a Joint Venture Company (JVC) formed with the majority stake of 51 per cent of the AAI and 49 per cent stake of the Punjab government through the Greater Ludhiana Development Authority (GLADA).

The AAI would bear all capital expenditure of development of new airport while the Punjab government would provide 135.54 acres of land free of cost and free of all encumbrances for the project.

The JVC will bear all expenditure on operation, management and maintenance including repairs, he added.

It is expected that Phase I of the project, which is the development of new international civil enclave in 135.54 acres for full-fledged operations up to Code-4C type of aircraft, shall be completed within three years.

The international airport at Ludhiana would not only be a commercially viable project and facilitate better air connectivity for passengers of Punjab but will also have a spin-off economic benefit for the industries in the state, the spokesperson added.

At present, Punjab has two international airports at Chandigarh and Amritsar.