‘Airports can’t come up without...grant of rights’

‘Airports can’t come up without...grant of rights’
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First Published: Mon, Feb 11 2008. 11 29 PM IST

On growth: Traffic triggers will decide expansion, says GMR Hyderabad airport CFO Rajgopal Swami.
On growth: Traffic triggers will decide expansion, says GMR Hyderabad airport CFO Rajgopal Swami.
Updated: Mon, Feb 11 2008. 11 29 PM IST
A Lufthansa aircraft would land at midnight of 15 March at the Hyderabad airport in Begumpet and leave for the new international airport at Shamshabad during the early hours of 16 March. From there, it would take off at 2.30am to Frankfurt to become the first aircraft to fly from the new airport built by GMR Hyderabad International Airport Ltd (Ghial). With the opening day near, the new airport is full of activity with trial runs overseen by Munich Airport officials, partners of GMR in the project.
For the last six months, officials of various airlines were busy testing connectivity with their local departure control systems and the efficiency of communication equipment provided at the new airport. Ghial’s chief financial officer Rajgopal Swami spoke to Mint about issues including connectivity to the new airport and on demands to keep the existing airport open even after the new one takes off. Edited excerpts:
On growth: Traffic triggers will decide expansion, says GMR Hyderabad airport CFO Rajgopal Swami.
What has been the progress?
The project is around 97% complete with works on runways, air traffic control tower and passenger terminal building almost completed. What is remaining is the finishing touches and polishing works. Key features of the airport include fully air-conditioned modular passenger terminal building with some 100,000 sq. ft of space, India’s longest civil aviation runway with 4,260m of length and 60m of width with 7.5m shoulders on both sides, which is capable of handling wide-bodied A380 aircraft. We have full-length taxiway and rapid exit taxiways providing quick turnaround time for aircraft.
What is the passenger and cargo handling capacity?
The new Hyderabad International Airport has been designed to handle 12 million passengers and (has a) 100,000 metric tonne cargo per annum cargo terminal facility that includes a cold storage facility.
What is the investment that has gone into the project?
The ultimate investment is to the tune of $3 billion (Rs11,910 crore) until the final phase. It is not possible to give individual break-up in terms of investment for phases. Investment on further expansion is purely based on traffic triggers.
Bangalore (whose new airport opens on 31 March) plans to begin work on the second phase of the airport terminal soon after the first one is opened. Is it the same with Hyderabad?
Hyderabad has witnessed a phenomenal growth of above 25% in air traffic in the last few years. It is projected to experience similar growth in the years to come, due to the booming IT industry, biotech and pharmaceutical industries in and around the city. In view of these, we have scaled up our airport capacity from the initial seven million passengers to 12 million passengers per annum in the first phase.
Bangalore is also planning a second runway a decade ahead of its plan due to the spurt in demand. What are your plans?
We have adopted a modular design for our airport, which will enable us to enhance the capacity to 20 million passengers per annum from the existing design capacity of 12 million passengers. On completion of the final phase, our airport can handle 40 million passengers. The second runway will come up in the second phase of the project, once we start handling 20 million passengers a year.
Have you marketed the new airport to foreign airlines?
We have been marketing the advantages of the airport to several international airlines. Gulf Air and British Airways are going to run four and five flights a week, respectively, for the first time from Hyderabad. Etihad Airways of UAE is also willing to begin its operations. However, they do not have bilateral arrangements with our government, which is being pursued now. Jet Airways says it would be increasing flights to Singapore. Singapore Airlines has also shown interest in increasing flights. We are talking to several new players such as Tiger Airways of Singapore, Virgin, Cathay Pacific, China Airlines and others. Owing to the constraints pertaining to payload at the existing airport at Begumpet, several airlines that wanted to run flights to Hyderabad could not do so. Now that the new airport at Shamshabad offers major advantages of infrastructure apart from payload, they should begin their operations from Hyderabad.
Lack of connectivity to the new airport seems to be a big issue...
The new airport is around 30km from the central business district. Ghial has submitted several connectivity and accessibility proposals to Andhra Pradesh and Central governments for consideration. They have been taking a lot of proactive measures. These include 11.6km four-lane elevated expressway from Sarojini Devi Hospital to Aramgarh Junction, widening of 52km inner ring road from four lanes to eight lanes with service roads, development of four-lane alternative road to Srisailam Highway, development of 162km outer ring road, widening of NH7 from four lanes to six-eight lanes, development of bypass road for diversion of freight vehicles from NH7 to NH9. Passengers can have reliable, 24x7 air-conditioned, electronic-metered taxi services. These 24x7 shuttle services will be run by private operators and would originate from around 15 locations across the city. Ghial has planned two city check-in centres closer to major air-traffic generation pockets.
There has been demand to retain existing Begumpet airport till connectivity issues are resolved.
As per the concession agreement signed with governments of India and AP (Andhra Pradesh), Begumpet Airport will be shut down for commercial operation, once the new airport opens in March 2008. Airports cannot come up without support and grant of rights and concessions from the government. Based on this only mobilization of resources becomes possible for any investor. Airports are considered to be economic drivers... In Hyderabad, there are rough estimates that on account of the new airport, around Rs1,600 crore has been contributed to the state government by way of land registration during the last three years.
What is the progress on offering maintenance, repair and overhaul (MRO) services?
Lufthansa Technik (LHT) is setting up the MRO facility in joint venture (JV) with the GMR group. Investment for the initial phase is more than Rs100 crore. The day-to-day running of the facility will be carried out by Lufthansa Technik. A land of 6.92 acres was given to Lufthansa Technik. The built up area would be around 20,000 sq. m.
The LHT MRO JV would be initially building a two-bay hangar facility and further expansion will be based on business demand. Actual commissioning of the MRO is planned for the last quarter of 2008. Once the facility is commissioned, we expect airlines would come to Hyderabad instead of going abroad to avail of the MRO services.
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First Published: Mon, Feb 11 2008. 11 29 PM IST
More Topics: Airports | GMR | Aviation | Traffic | Investment |