Friday, March 19, 2021

No objections from NITI Aayog, FinMin on Adani airport acquisitions: Hardeep Puri

The minister of civil aviation Hardeep Singh Puri has rejected reports of objections being raised by NITI Aayog and Finance Ministry towards privatisation of six airports in 2019 in favour of Adani group. In his reply to Lok Sabha, Puri said that the terms and conditions for privatisation of the six airports were decided by the Empowered Group of Secretaries (EGoS) which is chaired by CEO of the NITI Aayog, and the group comprised of secretaries of ministry of finance (Department of Economic Affairs and Department of Expenditure) as well.

"Therefore, the ministry of finance and NITI Aayog were part of the decision making process, and the EGoS finalised the contours of the bidding process for PPP [public private partnership] of six airports," Puri said.

Gautam Adani-run Adani Enterprises Ltd (AEL) won the rights to run Ahmedabad, Jaipur, Lucknow, Guwahati, Thiruvananthapuram and Mangaluru airports for 50 years. Last year, AEL took control of Ahmedabad, Lucknow and Mangaluru airports - months after it had asked the AAI (Airports Authority of India) to postpone the handover in the wake of pandemic.

The minister also said that in order to ensure higher competition and to give more flexibility to bidders, three bidding conditions were put in place. This included no prior airport experience, no cap on number of airports for which a participating entity could bid for, and per passenger fee as bidding parameter instead of revenue sharing. The first two conditions have reportedly raised doubts around the entire bidding process.

Adani Group has also completed the acquisition of 23.5 per cent stake in MIAL (Mumbai International Airport Ltd) last month. It bought this stake from two existing investors (ACSA Global Limited and Bid Service Division) of MIAL. The group aims to take its ownership in MIAL to 74 per cent by acquiring 50.5 per cent stake from GVK Group. With MIAL's acquisition, Adani Group would also get the right to develop the upcoming Navi Mumbai airport. Once that happens, Adani Group would become one of the largest airport operators in the country with eight airports under its belt.

19/03/21 Manu Kaushik/Business Today

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