Sunday, March 10, 2019

Joint venture with India for MRIA to fly high

The Cabinet this week gave the go-ahead to start formal negotiations with the Government of India (GoI) to reach final agreement for operation of Mattala Rajapaksa International Airport (MRIA), including rights to supply catering and ground handling services.

A joint Cabinet memorandum  titled ‘Implementation of the Proposal Submitted by Airports Authority of India for the Operation of Mattala Rajapaksa International Airport (MRIA)’ was approved on Wednesday.  It was submitted by Prime Minister Ranil Wickremesinghe, Finance Minister  Mangala Samaraweera and Transport and Civil Aviation Minister Arjuna  Ranatunga.

A Cabinet-appointed negotiating committee (CANC) and a project committee had earlier evaluated the proposals of the Airports Authority of India to manage MRIA. It submitted a report along with recommendations.

This week, the Cabinet agreed to empower the CANC to start formal negotiations for and on behalf of the Government of Sri Lanka (GoSL)  with designated officials of the GoI for the preparation of a final deal to be signed by the assigned parties of both Governments based on recommendations contained in the CANC report.

It consented to include in this agreement the right to provide catering and ground handling services under the definition of ‘commercial aviation’, whilst excluding from that term the right to provide aviation fuel and lubricants to aircraft.

Cabinet also sanctioned the Government of Sri Lanka to enter into a memorandum of understanding (MoU) with the Government of India after “successful negotiations” for the establishment of the proposed joint venture with the approval the Cabinet of Ministers pending required amendment to applicable aviation legal framework.

The Indian Government’s proposal, dated May 2017, envisages the setting up of a joint venture in which the GoI or its assigned entity would hold 70 percent of equity and the GoSL or its assigned entity would hold 30 percent.

The company would perform activities mentioned under commercial aviation; aircraft maintenance repair overhaul (MRO) facility; flying training school; emergency response, including search and rescue; humanitarian assistance and disaster relief activities; meteorological services; and any other use, as mutually agreed.

The project would require land to be released to the joint venture along with all existing infrastructure. Security of the airport, including perimeter security and deployment of anti-hijacking squad, is the responsibility of the GoSL. Sri Lanka will also have to develop external infrastructure for access to the airport, including public transport facilities.
10/03/19 Namini Wijedasa/Sunday Times