Govt seeks advisers for non-metro airports

Even as the Union Cabinet failed to take a decision on privatisation of the metro airports on Friday, the government has initiated the process of private participation in commercial development of land and operation of facilities at about 20 non-metro airports in the country.

"We are in the process of appointing a financial consultant to prepare an action plan on private sector participation in development and operation of city-side facilities of about 20 non-metro airports," said a senior government official.

The Airports Authority of India is preparing a list of airports for which the government will seek joint venture partners. In addition to most state capitals, these airports include tourist hubs like Gaya and Kochi.

Indian airports, including those in the metropolitan cities, earn a small fraction of their revenues from non-aviation related activities.

Even for large airports like Mumbai and Delhi, aviation accounts for nearly 80 per cent of their total income.

The international norm, in contrast, is that 70 per cent of revenues of an airport come from non-aviation related activities like shopping malls, commercial establishments and entertainment facilities.

"For all its claim of being a truly world-class airport, Indira Gandhi International Airport can boast of only the licence fees it gets from vehicle parking, cafeteria and half a dozen duty-free shops as non-aviation related revenues. The situation is much worse at the smaller airports, where there is virtually no commercial activity," the official said.

The consultant will conduct feasibility studies and traffic forecasts for commercial exploitation of airport real estate and indicate viable projects.

The consultant would also formulate a strategy for private investment for commercial development and help the Airports Authority of India in selecting joint venture partners, the official said.

Prospective financial consultants had been asked to submit their expression of interest by January 31, following which the Airports Authority of India would award the contract through competitive bidding, he said.