The grant of government approval for constructing an airport in north Kerala is attracting interest from infrastructure companies keen on participating in a project that will serve significant chunks of workers in West Asia hailing from the southern state and the nearly half a million foreign tourists visiting it every year.
Leading conglomerates, including the Leela Group, Tata Realty and Infrastructure Ltd and GVK Infrastructure Ltd, are among those keen to build the international airport in Kerala’s Kannur district, which was given a final approval by the Union government last week after nearly a decade since the project was proposed.
The Kannur airport is expected to be constructed on 2,000 acres of land with a single runway at a cost of more than Rs900 crore.
The Kerala government says it expects to invite proposals within six months and targets completion in two years from then.
The state-run Kerala Industrial Infrastructure Development Corporation will own 26% stake in the joint venture, with the rest held by a private consortium. “Now that it has been cleared, we will start the process of acquisition of land,” said M. Vijayakumar, the state’s minister for law, sports and youth affairs.
About four years ago, the Kerala government had signed an agreement with the Leela Group, which runs resorts and hotels, to construct the airport, but the process could not be carried forward without Union government approvals.
Interest in developing relatively smaller airports has risen dramatically with the most recent project—for terminal modernization of the Udaipur airport—receiving 21 bids from both domestic and international infrastructure companies including Fraport AG, Reliance Energy Ltd, GMR Infrastructure Ltd, Unitech Ltd and Emaar MGF Land Ltd, among others.
Airport projects such as the one in Kannur are few and far between, said Dinesh Chandiok, chief executive, Tata Realty and Infrastructure, referring to the fact that key metro airports at Mumbai, New Delhi, Bangalore and Hyderabad are already being modernized in a public-private partnership model, while Chennai and Kolkata are being upgraded by the Airports Authority of India.
“In infrastructure, you take the small with the big,” he said.