Land clause for merchant airports

New Delhi: After the issue of land acquisition disrupted large SEZ projects, the civil aviation ministry is planning to specify a minimum land ownership of 500 acre and certain financial criteria for the development of merchant airports, a ministry official said. Merchant airports are totally privately developed and operated.
“Ownership of a minimum of 500 acre of land in the areas where a firm wants to construct a merchant airport could be the criteria,” the official confirmed. “But the ministry is yet to work out the financial parameters,” he added. Merchant airports can be developed for commercial (both passenger and freight) and private use.
As merchant airports would obviate the need for government investment, the civil aviation ministry feels a liberal and licence-based approval procedure should be adopted. It also proposes to allow 100% FDI in such airports. But attracting investment in airport projects is considered difficult, as most of them take 10-15 years to turn a profit.
According to one research analyst, the merchant airport concept will be difficult to sell in India unless the government comes up with a clear policy on airport ownership and management.
According to a business research and consulting firm, by 2015 between $150 billion and $200 billion is likely to be invested in airports globally, of which 40-45% would be in the Asia-Pacific region.
08/06/07 Atreyee Dev Roy & Sunny Verma/Financial Express

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Categories: Airports Jun 2007, New Jun 2007