Mumbai: The Ministry of Civil Aviation (MoCA), Government of India has allowed Navi Mumbai airport, which is being built through a Public-Private Partnership (PPP) mode, to raise up to 26 per cent of its equity from airlines, but has said investing airlines will not have any representation on the airport’s board.
Airlines are currently allowed to invest up to ten per cent of the equity of PPP airports, up from five per cent a few years ago. Mumbai’s second airport in Navi Mumbai, being built by City and Industrial Development Corporation of Maharashtra Ltd. (CIDCO) sought clearances from the Ministry to allow this to be raised to 26 per cent, Mint’s Tarun Shukla reported.
“Airlines can invest, but they will not be given any board seat,” said a government official. The official said this was being done to ensure the investing airlines don’t get “undue benefits”. A 26 per cent stake (enough to make or block decisions) and a board seat could allow airlines to dominate decisions at the airport. The fear is that these could be detrimental to other airlines using the airport. Airlines compete for better slots and other facilities at airports.
05/08/14 TravelBizMonitor
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Airlines are currently allowed to invest up to ten per cent of the equity of PPP airports, up from five per cent a few years ago. Mumbai’s second airport in Navi Mumbai, being built by City and Industrial Development Corporation of Maharashtra Ltd. (CIDCO) sought clearances from the Ministry to allow this to be raised to 26 per cent, Mint’s Tarun Shukla reported.
“Airlines can invest, but they will not be given any board seat,” said a government official. The official said this was being done to ensure the investing airlines don’t get “undue benefits”. A 26 per cent stake (enough to make or block decisions) and a board seat could allow airlines to dominate decisions at the airport. The fear is that these could be detrimental to other airlines using the airport. Airlines compete for better slots and other facilities at airports.
05/08/14 TravelBizMonitor
