Regulator pulls up Delhi airport for high cost of makeover

New Delhi: Delhi airport’s $3 billion makeover has resulted in great acclaim for Terminal 3 as a world-class facility. But the newfangled modernity has come at a steep price, which may be paid for by travellers for several more years.
After an audit of the project, the regulator has criticized Delhi International Airport Pvt. Ltd (DIAL) for overshooting the budget to more than twice the initial estimate, not doing enough to keep a curb on surging costs, keeping the civil aviation ministry out of the loop and exceeding its mandate on the amount of work it was supposed to do.
DIAL, comprising a GMR Infrastructure Ltd-led consortium, completed the development of the airport in a record 37 months that ended March 2010. The airport was privatized by the government in 2006. The modernization cost shot up from Rs5,900 crore to Rs12,700 crore in the same period.
About one-fourth of the project cost is to be recouped through passengers by direct levies on airfare. DIAL has asked the regulator for about Rs3,500 crore in airport development fees.
Passengers are already paying Rs200 on domestic tickets and Rs1,300 on international flights as airport development charges, which would add to Rs1,800 crore by 1 March 2012.
DIAL has also asked for an additional Rs1,793 crore, of which the Airports Economic Regulatory Authority (Aera) has proposed to clear Rs994.5 crore so far. Aera made its observations on the technical and financial audit done by Engineers India Ltd (EIL) and consulting firm KPMG on the modernization.
The 179-page final audit report was made available this week on the Aera website.
25/04/11 Tarun Shukla/Live Mint

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Categories: Airports Apr 2011