GMR's Delhi airport cost overrun in focus again

New Delhi: The ministry of civil aviation is planning to once again ask GMR, which leads the consortium developing the Delhi International Airport (DIAL), for a detailed explanation over cost overrun.
The current estimate pegs the cost of modernising this airportat Rs 12,700 crore, significantly higher than the earlier-projected Rs 9,875 crore.
The ministry had written to GMR in April this year, too, but did not get details of projects which led to an overall cost overrun.
A ministry official told DNA, “We had asked DIAL to explain how and when costs escalated but they haven’t explained. We will write to them again… we need details of which specific projects within the airport led to overall cost escalation.”
He gave several examples of how, while constructing the new integrated terminal building, T3, GMR has overshot its own estimates given earlier.
“Glass work was extended to a much larger area without any previous planning to make the airport look good. Even the number of aerobridges was increased, which led to an increase in the terminal area and subsequently the overall cost for building T3. Earlier, GMR had projected that 70% of passenger traffic would use aerobridges but later changed this to over 90%… as many as 15 new aerobridges were added to the original plan.”
Sidharath Kapur, chief financial officer (airports) of GMR, said his company is cooperating fully with the Airport Economic Regulatory Authority (AERA), which has appointed two firms — Engineers India Ltd and KPMG — to conduct cost audit of DIAL.
28/06/10 Sindhu Bhattacharya/Daliy News & Analysis

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Categories: Airports Jun 2010, New Jun 2010