The government authorizes the rental of the airports of Ahmedabad, Lucknow and Mangaluru to Adani Group
NEW DELHI: The airports of Ahmedabad, Lucknow and Mangaluru will now be in charge of Adani Group in public-private partnerships such as the metro in Mumbai and Delhi with GVK and GMR Groups, respectively. The Cabinet of the Union approved on Wednesday the lease proposal of these three airports of the Airports Authority of India (AAI) in the manner of the PPP, said the minister of the Union, Prakash Javdekar, in a briefing after the Cabinet meeting.
The government decided to lease six airports (Ahmedabad, Jaipur, Mangalore, Trivandrum, Lucknow and Guwahati) for 50 years to operate public-private last year. AAI had invited bids in December 2018 and Adani group of Gautam Adani had become the highest bidder at these six airports.
When asked why only one decision was made about three airports when the tender for six airports was completed, Javdekar said: The process is complete (for these three places). Wait until the next one arrives (which means that the Cabinet will consider them when their process is also complete.
The movement for the six airports was the second major round of airport privatization after Delhi and Mumbai were handed over to private players, GMR and GVK, more than a decade ago. After emerging as the highest bidder for the six airports, the Adani Group said in a statement on February 26, 2019, that it would be aiming to expand the infrastructure so that these facilities are on par with global standards.
The Adani Group will be responsible for the operations and management of the existing airport assets, as well as the design, engineering, financing, construction and development of the additional infrastructure of air side, terminal, city side and land side for the airport and the operation and management thereof in accordance with the concession agreement and applicable laws, according to the terms of the PPP lease contract.
Improving the Delhi and Mumbai model, AAI has now opted for a new revenue generating model for the potential bidders of these six airports. The concessionaire will pay the Authority, on a monthly basis, a fee (the 'per passenger fee' or PPF) with respect to each passenger (national and international) handled at the airport, the request for proposal document. For these six airports says.
The Adani PPF was the highest for the six airports at Rs 177 for Ahmedabad; Rs 171 for Lucknow and Rs 115 for Mangalore. For the remaining three airports whose lease proposal will be considered by the Cabinet below, the Adani PPF was also high at Rs 174 for Jaipur; Rs 168 for Trivandrum Rs 168 and Rs 160 for Guwahati.
The airports of Jaipur and Ahmedabad had seven offers each; Lucknow and Guwahati six each and Mangalore and Thiruvananthapuram three each. In total, AAI had received 32 offers for the six airports of 10 bidders, with Adanbi and GMR for the six airports.
The PPF offer amounts show the aggressiveness with which the Adani Group made an offer for the airports. Adani's incursion into the airport will now mean that India has more private sector personalities in the field that until now was dominated by the GMR (Delhi and Hyderabad) and GVK (Mumbai and until a few years ago in Bangalore).