Now, cost cutting arrives at AAI

New Delhi: Airports Authority of India (AAI) has started tightening its belt to put a check on its worsening finances. The public sector airport operator has formed a finance committee on the lines of the national carrier to save on cost and enhance revenues. Besides scrutinising its revenue stream and outstanding, AAI is planning to aggressively leverage its real estate properties across the country.
“AAI has been asked to increase its revenue in order to meet its Eleventh Five-year Plan commitment. Its board has formed a finance committee headed by financial advisor in the civil aviation ministry EK Bharat Bhushan,” a government official said.
A debt-free company in 2005 with cash reserves of about Rs 1,500 crore, the airport operator is expected to have a debt of Rs 1,200 crore this financial year. While earlier it managed 15 profit-making airports, the number of such airports have come down to 11 with privatisation of various metro airports.
“AAI is losing Rs 300 crore annually due to Hyderabad and Bangalore airports going away from it to private players. Revenue earning from Delhi and Mumbai airports have, however, gone up,” AAI chairman VP Agrawal told ET.
17/07/09 Nirbhay Kumar/Economic Times

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Categories: Airports Jul 2009