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Business News/ Companies / AAI to get 5% stake in Navi Mumbai airport project
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AAI to get 5% stake in Navi Mumbai airport project

Cidco, which holds a 26% stake in the project, will sell at least 5% to the Airports Authority of India

The Navi Mumbai International Airport project is critical to Mumbai in view of the growing traffic and congestion at the existing airport. Photo: Hindustan TimesPremium
The Navi Mumbai International Airport project is critical to Mumbai in view of the growing traffic and congestion at the existing airport. Photo: Hindustan Times

The City and Industrial Development Corp. of Maharashtra Ltd (Cidco) has agreed to sell at least a 5% equity stake in the proposed Navi Mumbai International Airport project to the Airports Authority of India (AAI).

Cidco, which holds a 26% stake in the project, is the nodal agency to develop the international airport at Panvel, near Mumbai. It expects to award the tender for the 15,000 crore airport by December.

“We have held a high-level meeting last week with the civil aviation ministry. We have taken a decision to sell at least 5% equity to AAI. Both Cidco and the ministry are on the same page," said Cidco vice-chairman and managing director Sanjay Bhatia. He added that the corporation will start pre-development work such as levelling of the ground, river diversion and cutting of hills for the proposed airport by October.

AAI declined to comment.

The Navi Mumbai International Airport project is critical to Mumbai in view of the growing traffic and congestion at the existing airport. The airport project is likely to get a fillip with AAI’s participation, as the authority already manages a total of 125 airports in the country. The state government had given its in-principle approval to set up the airport in 2007, but land acquisition troubles caused delays.

The Navi Mumbai International Airport is expected to service 10 million passengers in 2017, its first operational year. By 2020, the number is expected to be 25 million. The projection for 2025 is 45 million passengers, peaking at 60 million in 2030. The air travel demand forecast for the Mumbai Metropolitan Region, as per a Cidco survey, reveals that demand will grow from 30 million passengers annually in 2012-13 to over 100 million passengers in 2030-31.

Of the nine local and international consortia that expressed interest in the airport, Cidco shortlisted four bidders in January: GMR Airports, Mumbai International Airport Ltd, Hiranandani Developers (along with Zurich Airport Developers), and MIA Infrastructure Pvt. Ltd (along with Tata Realty and Infrastructure Ltd). Mumbai International Airport Ltd, a joint venture of the GVK Group that is already running the Mumbai airport, has the right of first refusal over the Navi Mumbai airport project. If another developer outbids it by a 10% margin, then the airport company can match the bid and build the Navi Mumbai airport.

Bhatia stressed that Cidco would not allow Mumbai International Airport Ltd or any other developer to turn the new airport into a cargo hub as the idea is to roll out a full-fledged airport. “We have veto power in the airport project with 26% stake. In any case, Mumbai airport is reaching saturation in the next two years and it does not make any sense to convert Navi Mumbai International Airport into just a cargo or domestic terminal," he said.

Bhatia said Cidco would float a request for proposal by early June and award the tender by December. He added that there would be two runways and the airport would house Indian Air Force operations as well.

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Published: 12 May 2015, 12:51 AM IST
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