Confirming this, G V Sanjay Reddy, managing director of Mumbai International Airport (MIAL), said: "The idea is to facilitate business meetings of busy and high-profile corporate travellers who don't have the time to travel across the city."
Locating hotels within airport terminal premises is a common global practice.
MIAL is a joint venture between a consortium of Hyderabad-based GVK and Airports Company South Africa and Bidvest group and the Airports Authority of India (AAI) mandated to expand and modernise the airport.
The airport currently handles more than 25 million passengers a year which is expected to go up to more than 40 million by 2012.
GVK is expected to tie up with Indian Hotels, which owns the Taj brand. GVK already has a tie-up with Indian Hotels in Hyderabad for the Taj Krishna.
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Indian Hotels sources said the airport hotel at the airport will be in the five- star premium business category.
Sources familiar with the developments also said GVK may go in for two hotels at the airport: one, a small 65-room property that will come up on Terminal IC and will be completed first; the other one will be a much bigger property.