The government's mega airport upgrade plan may turn out to be a damp squib. It has pruned the list of major airports on public-private-partnership to barely two, at Ahmedabad and Jaipur. Worse, the much-hyped development of five no-frills airports hangs in balance with the finance ministry questioning their eligibility for government funding in the face of very low or negative returns.
"Most of the low-cost airports would be losing propositions. The finance ministry would support only those projects that have a minimum IRR (internal rate of return) of 12 per cent. They have refused to give any commitment and consider funding these airports on case-to-case basis," a civil aviation ministry official said, referring a communication from the finance ministry.
The aviation ministry has plans to build five no-frill airports at Belgaum and Hubli in Karnataka, Kishangarh in Rajasthan, Jharsuguda in Orissa and Tezu in Arunachal Pradesh. It had also planned to upgrade six international airports at Kolkata, Chennai, Jaipur, Ahmedabad, Lucknow and Guwahati through public-private partnership.
02/12/14 mydigitalfc.com
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"Most of the low-cost airports would be losing propositions. The finance ministry would support only those projects that have a minimum IRR (internal rate of return) of 12 per cent. They have refused to give any commitment and consider funding these airports on case-to-case basis," a civil aviation ministry official said, referring a communication from the finance ministry.
The aviation ministry has plans to build five no-frill airports at Belgaum and Hubli in Karnataka, Kishangarh in Rajasthan, Jharsuguda in Orissa and Tezu in Arunachal Pradesh. It had also planned to upgrade six international airports at Kolkata, Chennai, Jaipur, Ahmedabad, Lucknow and Guwahati through public-private partnership.
02/12/14 mydigitalfc.com
