Monday, May 14, 2018

From Chennai to Guwahati, govt likely to privatise 8 major airports

The government’s attempt at privatising maintenance of airport terminals has drawn a blank from investors. And, has forced the Narendra Modi government to mull complete privatisation — a plan initiated by the previous United Progressive Alliance government but dropped by the current regime, facing protest from employee unions.

The plan is to privatise at least eight government-owned airports — Chennai, Kolkata, Kochi, Pune, Ahmedabad, Jaipur, Lucknow and Guwahati.

The civil aviation ministry is having discussions on designing the model on how the airports would be bid out, according to sources. It is likely the airports will be bid out for 30 years and the tariffs will be fixed upfront.
Under the two models being examined, one is a forward bidding process based on tariff per passenger. Under this, players will bid on fee per passenger it will share with the Airports Authority of India (AAI). The player that quotes the highest figure will be chosen. The landing and user charges an operator will set during the concession period will be fixed upfront by the ministry.

The other model being considered is a reverse bidding model — essentially a tariff-based bidding.
14/05/18 Arindam Majumder/Business Standard

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