Mumbai: Several Indian firms, including some large conglomerates, and foreign companies are in the running to develop the international airport at Amritsar in Punjab which one aviation analyst calls “a valuable airport” because of its location and the number of airlines flying to it, a function of the huge non-resident Indian (NRI) population that has roots in that part of the country.
Among the initial bidders for the project are the Tata group, Reliance Energy Ltd, Larsen and Toubro Ltd (L&T), Zurich Airport, Vienna Airport, Gammon Infrastructure, Emaar MGF Ltd, K Raheja group, DS Constructions Ltd, Maytas Infra Ltd, Nagarjuna Construction Ltd, General Electric, DLF Ltd, Unitech Ltd, the GMR group and the GVK group.
Attraction value: A bird’s eye view of the Golden Temple in Amritsar. Companies are keen to develop the city side of the airport because of its real estate potential and the huge non-resident population from the region.
The project includes commercial operation and maintenance of the airport terminal spread across 41,000 sq. m and the so-called city side development covering 30 acres.
The Tata group has bid for the project along with Singapore’s Changi Airport while L&T has teamed up with Zurich Airport, said an official overseeing the bidding process at the state-owned Airports Authority of India who did not wish to be identified.
Amritsar airport handles about 150 commercial flights a week and has a passenger traffic of about two million a year.
“For big players, the objective behind participation in city side development of non-metro airports is to explore retail opportunities and real estate development rather than airport development. Shopping malls, restaurants, car parking, hotels and other facilities are revenue streams for these players,” said a Mumbai-based aviation expert who did not want to be named.
“Amritsar is a valuable airport in all aspects. Since it is just 10-12 km away from the city, the project assumes significance in terms of real estate development,” added Kapil Kaul, chief executive officer (Indian subcontinent and Middle-East), Centre for Asia Pacific Aviation, an international aviation consulting firm. He said the airport has several flights to and from international destinations, operated by Jet Airways Ltd and Air India.
Kaul added that these factors, in addition to opportunities on the domestic (routes) and cargo fronts, were responsible for the “response from leading players.”
Amritsar airport is setting up a new cargo handling facility to cater to demands from exporters in Punjab, Haryana and Himachal Pradesh, who currently have to ship out of Delhi.
Punjab is a major agricultural centre and the airport has a site for a perishable cargo centre that is to be located close to the air cargo complex.
The Airports Authority has recently developed a new terminal at Amritsar airport at a cost of Rs112 crore; the terminal will become operational in March.
A government committee on infrastructure, headed by Prime Minister Manmohan Singh, has estimated that India will need to spend more than Rs40,000 crore in developing airports by 2013-14. Of this, an estimated Rs31,100 crore is expected to come from the private sector through public-private partnerships such as the one planned for Amritsar.