The Indian government has decided and has further plans to award 25 airports, to the private players in the upcoming four years. The government has planned this project to complete it by March, as part of the “National Monetisation Plan”.
New Delhi: The Central government has decided to further complete the process of privatizIndian Ministry of Civil Aviation: Airports Authority of Indiaing the 13 airports. These airports are currently under the (AAI), Airports Authority of India. The reports have further mentioned that by the end of this fiscal year the part of this first major asset monetization, is the very first and is an earnest attempt to also use the funds collected for the public investments.
During an interview, with ET, AAI chairman Sanjeev Kumar said that “We have sent a list of 13 airports to the aviation ministry that is to be bid out on PPP (public-private partnership). The plan is to complete the bidding of these airports by the end of this fiscal.” He further went on to add that, “the bidding model would be based on the per-passenger revenue model as it has been used earlier and is successful and “the Jewar airport (in Greater Noida) was also bid out on the same model.” This will be the very first major assessment, for the Central government for the privatization of the airports under the part of the “National Monetisation Plan”.
In September 2021, the Board of AAI had approved privatizing a total of 13 airports, by March 2021. There are a total of 13 airports and among them, six are the major ones and the seven are smaller, as per the plan and the part of the government’s ambitious (NMP), National Monetisation Pipeline.
Central government has further targeted to bring in the private investment of around 3,660 Crore by 2024. Sanjeev Kumar further pointed out that, that this privatization will result in strong interest from all the investors for taking up these projects although Covid-19, has been all around the world. As the pandemic will lead to short-term effects upon the business and also for the airports that are over 50 years. AAI plans to further merge the seven small airports, along with the six big ones. According to the plan the merging will be with Varanasi with Kushinagar and Gaya; Amritsar with Kangra; Bhubaneswar with Tirupati; Raipur with Aurangabad; Indore with Jabalpur; and Trichy with Hubli.
As per the plan of NMP, the Centre has further planned to award 25 airports, in the upcoming four years, and also including the above-mentioned 13 airports. Back in 2019, the government had also awarded six airports, which include Ahmedabad, Jaipur, Lucknow, Thiruvananthapuram, Mangaluru, and Guwahati. They were awarded based on the billionaire Gautam Adani-led Adani group through the public-private partnership (PPP).
Even many experts have even given the view that this plan of the Central government, to cede control and further privatize the airports provides the guarantee of AAI a significant source of income irrespective of how the privatized airports perform financially.
The earnings of having dropped considerably berceuse of the pandemic, as it is recorded that there is a huge loss of Rs 1,962 crore in FY21 and due to this condition it was forced to borrow, Rs 1,500 Crore from the State Bank of India. The loan was taken to meet all the working capital requirements, and also include the salaries. However the decline in the Covi-19 cases and with the improvement of the Covid-19 situation.
AAI will be not in such a situation to borrow money, this year. Kumar even said that “Our capital expenditure will continue as planned. To meet the capital expenditure requirements for this fiscal, we have borrowed Rs 1,000 crore. Further, based on the future fund’s requirement, a decision on additional borrowing will be undertaken.” This plan will further be led to a leap in the improvement of transportation within the country.
