AAI to seek fresh agreement for airport privatisation

Intends to come up with fresh model concession pact, which was stalled due to certain reservations by the previous govt

With the new civil aviation ministry having assumed charge, the Airport Authority of India (AAI) is planning to soon take up the airport privatisation matter with the government. Before inviting request for quotation (RFQs) from potential bidders, AAI intends to come up with a fresh model concession agreement, which was stalled due to certain reservations by the previous government.

"The model concession agreement will lay down the terms of the bidding process. The agreement had been prepared once in March but the same was stalled since the previous government had certain reservations against it. We are now hopeful with the new government, the process will be expedited," said a senior official in the Airport Authority of India (AAI). According to the official, without the model concession agreement, the RFQs could not be received from the potential bidders by AAI.

"Potential bidders had readied their RFQs but the same could not be accepted until the model concession agreement was in place. Once the new government approves a fresh agreement, we can go ahead in accepting the RFQs from potential bidders," the official said while adding that the date for receiving RFQs were getting postponed due to non-availability of model concession agreement. Around 13-17 major firms had shown interest in airport privatisation at the Sardar Vallabhbhai Patel (SVP) International Airport in Ahmedabad including the likes of GMR, Adani Group, GVK, Essel Infra Projects, IRB, Essar and Sadbhav Engineering, among others.

In fact, infrastructure and aviation major GMR Group chairman GM Rao had confirmed to Business Standard earlier that the group may bid for the airport privatisation at Ahmedabad. The previous Ministry of Civil Aviation had put up six airports including Ahmedabad, Chennai, Kolkata, Lucknow, Jaipur and Guwahati for privatisation and had invited RFQs from interested private parties in mid January 2014.

According to Ahmedabad AAI officials, while the SVP International Airport sees 100 daily flights including six international flights, it has a capacity to go up to 150 daily flights including almost 15 daily international flights.

The SVP International Airport in Ahmedabad earns a Rs 100 crore profit annually with almost 100 domestic and international flights running daily from here.