Saturday, October 1, 2022

Privatisation: Trivandrum airport bid to be extended by 15 days

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New Delhi: The validity of the bid for the Trivandrum airport is expected to be extended by 15 more days in order to facilitate a deal between the Kerala state government and Adani Enterprises Limited (AEL). The two are expected to share the stakes of the airport. Sources in the Airports Authority of India (AAI) said that the Ministry of Civil Aviation (MoCA) is going to hold a high-level meeting to discuss issues related to the airport by the first week of August after the ongoing Parliament session concludes. A final call on the matter is expected to be taken at the meeting.

Status report

Adani Enterprises had won bids to operate six airports that were put up by the Centre. The letter of approvals (LoA) for three airports out of six have already been given to the bidder. The Cabinet is expected to give its nod for the grant the letter of approval (LoA) for Guwahati and Jaipur airports shortly. And a final call on the Trivandrum airport is likely to be taken after the meeting.

Majority stakes would be with AEL

Sources said that even though the ministry would give a letter of approval to manage and operate the airport to Adani Enterprises, the company will have to enter a deal with the Kerala state government. As per the understanding between the two, the state government would be given a stake in the airport proportionate to the amount of investment it has made in the airport over the years. The state government will then float tender inviting partners to the newly formed company for running the airport. However, the majority of stakes would rest with Adani Enterprises.

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The backdrop

The state has already registered a company called Trivandrum International Airport Limited (TIAL) with an authorised capital of Rs 10 lakh and paid-up capital of Rs 5 lakh. The Board of Directors consists of Chief Secretary Tom Jose, Additional Chief Secretary (finance) Manoj Joshi, Principal Secretary (Transport (aviation) department) KR Jyothilal, and Sanjay M Kaul, MD, Kerala State Industrial Development Corporation (KSIDC). Even though KSIDC took part in the bidding process on behalf of the state government, it lost the bid to AEL in February. The state government has since been exerting pressure on the Centre and the PMO to get the rights of the airport through various channels.

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