Turbulent skies

Updated: Feb 2 2006, 05:30am hrs
The UPA government has often been accused of pussy-footing on reform. On Wednesday, however, even its severest critics would have found it difficult to question its reform credentials. In the face of protests at airports all over the country and voluble unhappiness from the Left, the Cabinet approved the award of the Delhi and Mumbai airport modernisation projects to GMR-Fraport and GVK-ACSA, respectively.

With this, the curtain has come down on one of the most contentious aspects of the modernisation programme. But, as Wednesdays events have shown, this is only the first step. The government now needs to stand firm and not allow opposition from the Left or from employees of the Airports Authority of India (AAI) to deter it. This will not be easy. Predictably, the decision has riled not just some of the losing contenders, but also the UPAs Left partners and AAI employees, who have threatened to scupper the programme. They must be firmly checked.

Its been 16 long months since the government decided to modernise the two airports in partnership with the private sector. Meanwhile, conditions at these two airports, that together account for 50% of the countrys air traffic, have steadily deteriorated. All that is now set to change. For three reasons. Though long-winded and time-consuming, the process adopted for selection of winners has cleared lingering doubts about the merits of the final winners. Given the stakes involved, it is perhaps inevitable that the award should see a spate of allegations and counter-allegations from the losers. And though there is also the danger that aggrieved contenders may try to put a spoke in the wheels by dragging the matter to court, the AAI has tried to pre-empt this move by filing a caveat in the Supreme Court.

Hopefully, the Left, too, can be made to see reason. After all, what is indisputable is that AAI will see a huge improvement in its cash flows in the process. GMR, for instance, will share 45.99% of its revenue stream, while GVK will part with 38.7% of its revenues from Mumbai airport. Given that air traffic is expected to grow exponentially in the coming years, this is bound to translate into an ever-increasing stream of revenues for AAI. The employees may prove more difficult to tackle. Here the government will have to combine tact with resolve. It needs to stand firm, even as it reaches out to employees to assuage their fears. The task is not insurmountable. The government just has to put its mind to it.