The state-owned Airports Authority of India (AAI) has proposed to lease its city-side land at nearly 35 non-metro airports instead of following a public-private partnership (PPP) pattern suggested by the finance ministry which seeks to improve non-aeronautical infrastructure along with private firms.
The country?s largest airport operator has got the backing of civil aviation ministry which is of the view that airport agency has the right to lease its lands under AAI Act.
The differences over infrastructure development around the airport between the civil aviation ministry and other government departments including the Planning Commission has delayed the city-side works at the smaller airports such as Lucknow, Dehradun, Vishakhapatnam and Ahmedabad.
?The Committee on Infrastructure (CoI) had directed city side development on PPP model earlier assuming AAI would get the required fund for upgrading terminal building and related facilities from private firms. Now that AAI has invested its own funds and almost completed the works it does not need to go for PPP for city-side development,? a senior official in the civil aviation ministry said.
The aviation ministry is expected to write to cabinet secretary KM Chandrasekhar on the issue. Following a value for money (VoF) analysis for non-metro airports the department of economic affairs (DEA) in the finance ministry had recently suggested the AAI to give all the spaces including the terminal building under PPP to ensure commercial viability. The AAI is, however in no mood to go for the joint venture (JV) route for city-side works and instead lease out the land for 30 years with the option to extend it for long-term.
?They (finance ministry) can only give their views. City-side development would be done as per the AAI Act. The airport operator is within its rights to follow the land-leasing model,? the official said.
An AAI official stressed that the authority cannot give airside to private parties for operation and maintenance arguing that the government had earlier decided to develop cargo, car-parking and city-side facilities on PPP mode.