AAI revenue now poised for a healthy take-off

New Delhi,Jan 31 | Updated: Feb 1 2006, 05:30am hrs
The aggressive financial bids of GMR-Fraport and GVK-South Africa consortia for the Rs 5,400 crore Delhi and Mumbai airports modernisation project should augur well for the financial health of the Airports Authority of India (AAI).

To start with, the government owned body which runs about 125 airports in the country will receive an upfront payment of Rs 150 crore each by the two private consortia which won the bidding race on Tuesday.

The Delhi and Mumbai airports, which takes about 50% of the total domestic traffic and about 25 million passengers is the most hit in terms of infrastructure facilities. Aviation in the country is so Delhi-Mumbai centric that development of other airports has not been possible, CAPAs Kaul said.

At present, Delhi and Mumbai, together account for 33% of AAIs total revenues. According to civil aviation secretary Ajay Prasad, Delhi airports total revenues for the year ending March 2005 stood at Rs 400 crore.

Considering the new revenue share of 46% offered by GMR-Fraport for Delhi airport AAi will still earn a revenue of approximately Rs 180 crore, while at 38% revenue share in Mumbai, AAI can look forward to apr Rs 140 crore revenues from GVK-South Africa.

Expressing satisfaction over the revenue share offered by the two successful bidders, the civil aviation minister said that the funds accrued on account of this would help modernisation of other airports, contrary to the belief that privatisation of the Delhi and Mumbai airports would affect the financial viability of AAI.

This would help the government to concentrate on development of 35 other non-metro and other airports and help in development of the civil aviation sector, he said.