Cabinet clears upgradation of Nagpur International Airport

New Delhi:The Union Cabinet on Wednesday approved the upgradation of the Nagpur International Airport through a public-private partnership.

The Cabinet has cleared the extension of the lease period of the Airports Authority of India's land allotted to MIHAN India Ltd beyond August 6, 2039. This will enable MIL to license the airport to GMR Nagpur International Airport Ltd (GNIAL), an official release said.

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Briefing media persons on the Cabinet decisions, Information and Broadcasting Minister Ashwini Vaishnaw said the upgradation and modernisation of the airport has been approved.

With the extension of the lease period for the land beyond August 6, 2039, the civil aviation ministry said it would now become co-terminus with the 30-year concession period of GNIAL.

"This is expected to usher in a new era of growth and infrastructure advancement for Nagpur airport. With private sector efficiency and government oversight, the airport is poised to see significant investment, modernisation, and improved passenger and cargo services," the ministry said in the release.

In 2009, the Airports Authority of India (AAI) and Maharashtra Airport Development Company Ltd (MADC) set up the joint venture MIL with an equity structure of 49 percent and 51 percent, respectively.

"Though Airport assets of AAI were transferred to MIL in 2009 for airport operation, the lease deed got delayed due to land demarcation issues. Subsequently, AAI land has been leased to MIL up to 06.08.2039," the release said.

Later in 2016, MIL floated a global tender for identifying a partner to operate the airport under the public-private partnership model.

GMR Airports Ltd (GAL) emerged as the highest bidder, with a quoted revenue share of 5.76 percent.

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"This was later revised to 14.49 percent of Gross Revenue. Subsequently, MIL annulled the bidding process in March, 2020. This annulment was successfully challenged by GAL before the Hon'ble Bombay High Court.

"Thereafter, the Hon’ble Supreme Court of India also ruled in favour of GAL. Pursuant to the Supreme Court Judgement dated 27th September, 2024, MIL signed a Concession Agreement with 2nd JVC, i.e. GMR Nagpur International Airport Ltd. (GNIAL) on 8th October, 2024," the release said.

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