The Bangalore international airport project is expected to be finally cleared by the cabinet next week, civil aviation ministry sources said. The Airport Authority of India (AAI) will pick up a 10 per cent stake in the project. The project, which is a $200-250 million venture, is to be developed on a build-own-operate-transfer (BOOT) basis by a consortium comprising Tata-Raytheon, Singapore Changi and a group of financiers from Singapore.
The Karnataka government had signed a memorandum of understanding (MoU) with the consortium to build the airport on a build-own-operate basis in December, 1995. The project was scheduled for completion by 2000. However, the ministry refused to clear the project unless it was developed on a BOT basis. The ministry constituted a 10-member committee, headed by AAI chairman and managing director Ranjan Chatterjee, to come up with a solution. Finally, the project was cleared on a BOOT basis.
In an attempt to get clearance, the Karnataka government had offered a stake to AAI in the proposed project. It had even offered to incorporate a clause in the shareholders agreement providing for a review to allow AAI to increase its stake on an agreed valuation basis. AAI was also allowed to nominate its representative on companys board.
It has now been decided that AAI would pick up a 10 per cent equity stake in the project. The ministry has stated that it will now also consider BOO projects on a case to case basis following the clearing of the new airport infrastructure policy.
