Sunday, January 17, 2021

Sky not the limit for airport privatisation

A government-appointed committee has dropped the proposal floated by the civil aviation ministry to restrict the number of airports a private operator can bid for under the public-private partnership model.

Sources in the government said the committee, after examining the market, came to the conclusion that there are not enough players in the sector to take up airport privatisation, so putting any kind of cap would delay the entire exercise to privatise airports. The proposal was that a private operator cannot bid for more than two projects in a round of auction.

The government is likely to invite bids for privatisation of Varanasi, Calicut, Patna, Amritsar, Bhubaneswar, Ranchi, Coimbatore, Trichy, Indore and Raipur airports in the next round and the guidelines once finalised would not have any restrictive clause, sources said.

The proposal for putting some kind of restriction on number of projects one operator can bid for was mooted last year with Adani Group winning all six projects in the 2019 airport privatisation bids.

The airports on offer were Jaipur, Guwahati, Thiruvananthapuram, Mangaluru, Ahmedabad and Lucknow.

In 2020, the Adani Group emerged as the largest player in the airports business in terms of number of projects after it struck a deal to acquire the controlling 74% stake in Mumbai International Airport (Mial) from the GVK Group and other partners.

This development had further activated the government to look at putting some kind of restriction on the number of projects one party can bid for. The task was given to an inter-ministerial committee.

17/01/21 Financial Express

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