 | « Back to article | Print this article |
Over the next few years, the face of Indian airports is going to change beyond recognition.
Every airport, metro or non-metro, will have an international ambience: there will be multiple runways and passengers will use only aerobridges to board planes and alight anywhere in the country.
Delhi, which now has two runways, will have four and will handle traffic of up to 50 million passengers annually. At present, the figure is 10 million.
At the moment, the country's airport infrastructure is bursting at its seams with only 170-odd jets criss-crossing Indian skies. This number will jump to over 400 in the next five years as seven or eight new airlines are set to take wings and existing carriers, Indian as well as international, will press more flights into service.
Civil Aviation Minister Praful Patel has no option but to move fast. His plans have the blessings of the Committee on Infrastructure headed by Prime Minister Manmohan Singh.
Patel's gameplan
All told, the modernisation programme can cost as much as Rs 40,000 crore (Rs 400 billion). A large chunk of this investment will be brought in by the private sector.
Greenfield airports are being built in Bangalore by a Siemens-led consortium and in Hyderabad by the GMR group. The Delhi and Mumbai airports are slated to be modernised through privatisation. Kolkata and Chennai could be next in line.
On his part, Patel has kicked off an exercise aimed at giving a facelift to 35 non-metro airports at a cost of Rs 6,000 crore (Rs 6 billion). In his office, he already has computer generated images of what the airports from Srinagar to Trivandrum will look like. Patel hopes to take up at least 10 airports this year.
To bankroll this investment, the Airports Authority of India, which owns these airports, will soon issue bonds. AAI is not starved of cash: It generates annual profits of around Rs 300 crore (Rs 3 billion) and is sitting on free reserves of almost Rs 1,300 crore (Rs 13 billion).
But the funds required are huge. To bridge the gap, the government has decided to develop the city-facing land of the 35 airports. On these land will come up new ventures in which private players will be offered a majority stake.
The money so generated will go into the modernisation of these airports. The government has appointed two consortia, one led by Ernst & Young and the other by UTI Bank, to submit detailed reports on how best to develop city-facing land.
While renovating the airports, it has been decided to go in for modular designs so that the facilities can be expanded seamlessly once the need arises.
"We have been making buildings and not terminals," Patel said, adding that there will be rapid exit and taxi tracks, and better air traffic control.
So far as the Delhi and Mumbai airports are concerned, Patel is hopeful their privatisation will begin as per schedule by the middle of this year. Denying any differences within the government over the tax breaks proposed to be offered to the concessionaires, he said all hitches for the privatisation of the two airports had been cleared.
The process was held up, he said, on the issue of stamp duty to be paid to the governments of Maharashtra and Delhi for the transfer of land. While Maharashtra has agreed on this by waiving stamp duty, Delhi is close to giving its nod, Patel added.
Patel is also trying to push for faster development of both the airports. According to him, there will be higher points in the bidding process for those giving an accelerated development plan.
However, expanding the Mumbai airport can be a problem because of the slums surrounding it. To get over the problem, the government has identified land for developing a new airport in Navi Mumbai. But an airport next door can impact the profitability of the Mumbai airport.
Therefore, the government has been decided that whoever gets the Mumbai airport contract will have the right of first refusal to develop the new airport. The Navi Mumbai airport, Patel reckoned, could cost as much as Rs 7,000-8,000 crore (Rs 70-80 billion).
The challenge before him is tough. At the moment, airports in Delhi and Mumbai rank very low in passenger esteem.
According to International Air Transport Association's global airport monitor, the international airport in Delhi scores 2.6 in total customer satisfaction against a global average of 3.7 and an Asian average of 3.5. The Mumbai airport has an even lower score of 2.3.
The challenges
