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Cabinet approves leasing out six airports through PPP

PW Bureau

Ahmedabad, Jaipur, Lucknow, Guwahati, Thiruvananthapuram and Mangaluru airports to be operated, managed and developed under PPP New Delhi: Adding to the list of the five airports that were being managed under the Public Private Partnership (PPP) model, the Union Cabinet has given “in-principle” approval for the operation, management and development of six more airports of Airports Authority of India (AAI) — Ahmedabad, Jaipur, Lucknow, Guwahati, Thiruvananthapuram and Mangaluru — under PPP. Currently, the airports being managed under the PPP model include Delhi, Mumbai, Bangalore, Hyderabad and Cochin. The Cabinet also gave a nod to the constitution of an Empowered Group of Secretaries headed by CEO, NITI Aayog, Amitabh Kant. The group will comprise of Civil Aviation Secretary Rajiv Nayan Choubey, Department of Economic Affairs Secretary Subhash Chandra Garg and Department of Expenditure Secretary Ajay Narayan Jha and will decide on any issue falling beyond the scope of the Public Private Partnership Appraisal Committee (PPPAC). The move is expected to hasten the process of getting approvals for PPP projects.

Greater efficiency, world-class infrastructure

PPP in infrastructure projects brings efficiency in service delivery, expertise, enterprise and professionalism, apart from harnessing the needed investments in the public sector. As far as airport infrastructure projects are concerned, the PPP model has brought world-class infrastructure at airports, ensured efficient delivery and timely services to the airport passengers, augmented the revenue stream to the AAI without making any investment, case in point is the development of Greenfield Airports at Hyderabad and Bengaluru. In India especially, the airports being managed under a PPP model have been ranked among the top five in their respective categories by the Airports Council International (ACI) in terms of Airport Service Quality (ASQ).

PPP could open gates to FDI

The increase in domestic and international air travel in India combined with congestion at most airports, and the strong traffic growth at the five airports which were privatised over a decade ago has attracted the attention of several international operators and investors. The airport sector is the top contender among infrastructure sectors in terms of international interest. International operators and investors prefer brownfield airport expansion opportunities with having more than 3-4 million passenger capacity. The airport sector may provide an immediate opportunity to attract foreign direct investment (FDI) by the adoption of a PPP approach.