Air-India wants stakes in airports

Aims at owning at least one terminal in Mumbai & Delhi airports.

Air-India wants to be a part of the modernisation and privatisation of the Mumbai and Delhi airports. That is, it wants to own at least one terminal in each airport.

"We want to own at least one terminal in the Mumbai and Delhi airports. We want do this by becoming a part of the modernisation project," V Thulasidas, chairman and managing director, Air-India, told Business Standard.

The move by the national carrier follows the government's decision to free Delhi and Mumbai airports "" the two largest airports in the country "" from the complete control of the Airports Authority of India (AAI) and allow the private sector, public sector undertakings and domestic airlines to be part-owners of the airports.

Under the present policy, 74 per cent equity in the two airports can be held by private companies with a 49 per cent cap on foreign direct investment, while the remaining 26 per cent can be held by government-owned companies, including Air-India and Indian Airlines. Of the 25 per cent private Indian holding, Indian domestic carriers are allowed to hold up to 10 per cent equity.

Air-India wants to be a part of the government entities that will be selected to hold equity in the venture. It is also open to being part-owners of the government holding in the venture.

However, Air-India is yet to make a formal proposal. "We are evaluating the situation and will take a decision in consultation with the government," Thulasidas said.

Air India thinks owning a terminal in the two busiest airports in the country will help it manage its operations better.

Besides, excess capacity in the terminals can be given out to other airlines to generate additional revenue.

"This is the practice in most parts of the world. National carriers operate and own terminals in most of the airports. We also want to do it in India," he said. Once the airline owns the terminal, it will be undertaking functions like ground-handling and other services in that terminal.

The government's decision to allow private investment in the airports have kicked off a series of negotiations between companies to form a consortium to bid for the project. Companies like Changi Airport and the Bharti Group have also formed joint ventures for the purpose.