T-3 master plan flouted: Audit

New Delhi: New Delhi International Airport Ltd (DIAL), which constructed and operates Delhi airport, “over-engineered” the new Terminal-3 by building more floor space than stipulated under the master plan, says a cost audit report submitted to the Airports Economic Regulatory Authority (AERA).
The report points out that while DIAL’s cost estimate for the project went up from Rs 8,975 crore to Rs 12,700 crore, a significant portion of that increase — around Rs 750 crore — was due to the construction of more floor space than originally approved. The audit report also points out that the cost estimates include Rs 350 crore for a new air traffic control tower, which DIAL has not yet built.
AERA had tasked public sector Engineers India Ltd (EIL) and global accounting advisory firm KPMG to prepare the report after being approached by DIAL for an extension in the period for which it could charge passengers an airport development fee. DIAL contended this was because the cost of the project had risen by Rs 3,725 crore.
A source in the aviation ministry said the airport developer “over-engineered” — simply put, built more space in — the terminal by 80,000 sq m. The area it was required to build under the master plan approved for the airport building by the government was 470,000 sq m. DIAL built 550,000 sq m. The report says assuming a cost of Rs 90,000 per sq m, the cost over-run was Rs 750 crore. Responding to queries from Business Standard, a DIAL spokesperson stated: “This ‘news’ is entirely speculative and as per company policy, we would not want to comment on any speculative news at this stage.”
03/12/10 Mihir Mishra/Business Standard

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Categories: Airports Dec 2010