GVK Power and Infrastructure Ltd’s shares ended down over 1% on Monday ahead of the group winning a Rs 16,000-crore project to develop an airport at Navi Mumbai — the metropolis Mumbai’s satellite-town and a fast-emerging financial hub.
GVK-led company Mumbai International Airport Ltd (MIAL) beat GMR Infrastructure to win the bid. Its shares ended at Rs 6.6 on Monday, down 1.35%.
GVK operates the Mumbai international airport, while GMR operates the Delhi International Airport. The two companies had earlier today submitted their bids to the City and Industrial and Development Corporation (CIDCO), after the authority granted two extensions.
The government had approved building the Navi Mumbai airport as early as 2007. However, the project ran into sequential delays arising out of environmental concerns and land acquisition problems.
The proposed Navi Mumbai is expected to ease the congestion at the airport in Mumbai city.
The project will be carried out on public private partnership (PPP) basis, and CIDCO will incur pre-development work costs, which it will later recover from GVK.
CIDCO is Navi Mumbai’s nodal town planning authority.
CIDCO had failed to attract any bidders for the project at the earlier two occasions, and was forced to alter the project conditions to make it attractive for developers.
Major airports in India, including Mumbai and Chennai, are bursting at the seams with the domestic passenger traffic growing at over 23% year-on-year. India’s domestic passenger air traffic is estimated to have grown well above 10 crore passengers in a year.
You may also like to watch:
Going by the past trends of passenger traffic growth, the government expects these volumes to triple in the next 10-15 years, which would require increasing of airport capacity by three times.
Delhi’s Indira Gandhi International Airport (IGIA) was the 12th busiest airport worldwide for the month of November, 2016. It handled 5.5 crore passengers in the last year 2016. Mumbai Airport, on the other hand, handled 4.4 crore passengers in the year.
The government has granted “in-principle” approval for setting up of the 18 greenfield airports — Mopa in Goa; Navi Mumbai, Shirdi and Sindhudurg in Maharashtra; Bijapur, Gulbarga, Hasan and Shimoga in Karnataka; Kannur in Kerala; Durgapur in West Bengal; Dabra in Madhya Pradesh; Pakyong in Sikkim; Karaikal in Puducherry; Kushinagar in Uttar Pradesh; Dholera in Gujarat and Bhogapuram in Vizianagaram district near Visakhapatnam, Dagadarthi Mendal in Nellore district and Oravakallu in Kurnool district in Andhra Pradesh.
