Adani getting control of 6 airports? Uncertainty looms as matter missing on Cabinet’s agenda

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Published: March 8, 2019 6:04:26 AM

The group’s flagship, Adani Enterprises had recently bid aggressively and won the bids for the privatisation of all of the six airports put out by the Airports Authority of India.

Adani Enterprises had bagged the rights to operate, manage and develop airports at Ahmedabad, Jaipur, Lucknow, Thiruvananthapuram and Mangalore by offering the highest per-passenger fee (PPF).

With the formal proposal of handing over the six airports recently won by Adani Enterprises through an open bid not figuring on the Union Cabinet’s agenda on Thursday, a cloud of uncertainty hangs over the prospects of the group’s foray into airports.

The group’s flagship, Adani Enterprises had recently bid aggressively and won the bids for the privatisation of all of the six airports put out by the Airports Authority of India.

According to the concession agreement, the facilities were to be handed over to Adani Enterprises for a period of 50 years under the public-private partnership model, only after the approval of the Union Cabinet.

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Since Thursday’s Cabinet meeting was supposed to be the last one in which major policy-related decisions could be approved before the dates for the general elections are announced and a model of conduct prohibits government from giving such approvals, speculation is rife that Adani group may have to wait till after the elections to get the control of the airports.

However, a senior government official told FE that the decision vests in the government. “If it decides to accord Cabinet approval to the bids won by Adani Group it can do so even after the model code of conduct comes into effect but only after taking the approval of the Election Commission,” the official said.

In such cases, the government needs to put up a case that all major decision-making was done before the conduct came into force and granting the final nod is a mere formality. It also needs to convince the Election Commission that the decision in no way is directly linked to poll prospects of the ruling party.

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However, the official declined to tell whether the government has decided to approach the Election Commission on this issue as the final proposal for approval has not reached the Cabinet level yet.

Adani Enterprises had bagged the rights to operate, manage and develop airports at Ahmedabad, Jaipur, Lucknow, Thiruvananthapuram and Mangalore by offering the highest per-passenger fee (PPF). PPF is paid by the developer to state-owned AAI for every domestic and international passenger handled at the airport.

Meanwhile, the Kerala government has moved the high court challenging the award of Thiruvananthapuram airport to Adani Enterprises terming it arbitrary and illegal. KSIDC, a state-backed special purpose vehicle, had lost out to Adani Enterprises in the bid.

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