Even as a group of ministers on Thursday began discussing locating an airport that will effectively become Delhi’s second at Jewar in Greater Noida, Uttar Pradesh, an executive at Jaypee Group, which recently won the rights to build an expressway in the state, said it would bid for the development of the airport and that it was in talks with several possible partners.
The project has already become controversial with GMR Infrastructure Ltd, one of the partners in Delhi International Airport Ltd (DIAL) which is redeveloping the New Delhi airport, claiming that any airport located within a 70km radius will affect DIAL’s financial viability.
Meanwhile, Jaypee Group is in talks with Madrid Barajas Airport Authority, which operates the Spain’s Madrid Barajas International Airport, Houston Airport System (HAS), the company that manages the Houston airport, and three other companies to build the airport at Jewar, the Taj International Airport.
The airport in New Delhi. The proposed Taj International Airport at Jewar in Greater Noida, Uttar Pradesh, will effectively become Delhi’s second airport. (Rajeev Dabral / Mint)
“The Government of India is yet to clear the project. As and when the project comes up for bidding, we will be bidding for it. Everyone is interested in tying up with us. We have talked to the Madrid Airport, HAS and three other companies,” said Manoj Gaur, executive chairman, Jaiprakash Associates Ltd. He declined to name the other companies.
Jaypee Group also plans to bid for airports in other metro and smaller cities as well and may participate in the bids for developing 35 tier-II city airports across the country which are up for modernization.
Most Indian companies interested in airport development are tying up with international firms in an attempt to acquire technical and managerial expertise. For instance, DLF Ltd has tied up with Germany’s Fraport, while the Tata group has a partnership with Singapore’s Changi Airport International.
“Due to historical reasons there are no private sector airport operators in India. An international operator will only help the Indian companies by providing technical and management skills. Such tie-ups will have a beneficial effect on the sector,” said Amrit Pandurangi, who heads the infrastructure practice at audit and consulting firm PricewaterhouseCoopers.
“We are not aware about what kind of tender document will be brought out for Jewar and what kind of equity investment the Uttar Pradesh (UP) government is looking for from the various consortium members. Ultimately, the bidder will have to be a consortium. Befitting the requirement for the bid, we will finalize our consortium partner,” Gaur said.
The Jewar project was first proposed by the Mayawati government in 2003-04. The project was revived by her after she returned to power last year and is being speedily processed by the Union government, which has already given an “in-principle” approval to it. Although Mayawati’s relationship with the Congress, the dominant party in the ruling United Progressive Alliance at the Centre, has since deteriorated, the project is still alive and its fate is to be decided by a group of ministers headed by finance minister P. Chidambaram.
The group’s meeting on Thursday to take a view on legalities of having an airport at Jewar remained inconclusive even as the UP government agreed to grant a first right of refusal to the company running the Delhi international airport when the project seeks bidders, according to government officials familiar with the process who did not wished to be quoted.
Gaur said “anyone talking about the 70km radius must read the provision, which states that Delhi International Airport Ltd (DIAL) has the first right of refusal for the Greater Noida airport which allows it to match the highest bid if its quote is up to 10% less than the former. There was always clarity that there might be a second airport within a 70km radius.”
A DIAL spokesperson declined to comment on the issue.
(Tarun Shukla contributed to this story.)