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Airports sale nod sought again

March 24, 2003 13:31 IST

The civil aviation ministry has sent a note to the finance and law ministries and the Planning Commission seeking an in-principle approval for privatisation of airports.

Senior officials of the Airports Authority of India said the ministry had prepared a comprehensive note on the amendment of the AAI Act 1994, which would clear the path for privatisation. Once the comments come in from the concerned ministries and the Planning Commission, the civil aviation ministry will approach the Union Cabinet.

"The ministry has asked for a blanket approval and demarcated basic guidelines for the privatisation of airports. The equity structure has not yet been specified, but that will be taken up on a case-to-case basis," officials said. The ministry has sought permission for corporatisation of the Mumbai and Delhi airports in keeping with its long-term aim of privatisation.

The proposal for the amendment of the AAI Act also takes into consideration the two greenfield airports of Bangalore and Hyderabad.

The amendment will ensure that the two airports are kept away from the direct purview of AAI. It will also allow the levy of the airport development fee at the existing airports in Bangalore and Hyderabad airports.

For the upgradation of the Mumbai and Delhi airports, the AAI has invited tenders from international architects. The selection is likely to be completed by the end of this month. The entire cost of the upgradation is likely to be Rs 3,500 crore (Rs 35 billion).

In January, the civil aviation ministry had sent a proposal to the Cabinet for forming a joint venture for the four metro airports, with AAI holding 5 per cent stake. The cabinet had asked the ministry to re-work the proposal in consultation with the finance ministry.

The finance minister had announced the decision regarding the corporatisation of the Mumbai and Delhi airports in his Budget speech.

BS Economy Bureau