Adani Enterprises Ltd (AEL), Fairfax India Holdings Corp., and GMR Infrastructure Ltd were among the four bidders who qualified for the ₹30,000-crore Jewar airport at Greater Noida, Uttar Pradesh.
The four companies met the technical and financial criteria set out by the state government to qualify for the bidding process for the Noida International Airport Ltd (NIAL) project, two people aware of the development said, requesting anonymity. The airport, which is expected to be completed by 2040, will be the largest airfield in India with 4-6 runways.
Mint could not confirm the identity of the fourth bidder. Around 20 companies, including government-run Airports Authority of India, Zurich airport operator Flughafen Zurich AG, and Anil Ambani-led ADAG group, had shown interest in the project.
Spokespersons for GMR, AEL and Fairfax did not respond to Mint’s queries seeking comment.
The bidding process for NIAL will be run by the Yamuna Expressway Industrial Development Authority, the state-run implementation agency for the greenfield project.
The winning bid will be decided on the basis of the highest monthly per-passenger fee that the concessionaire will offer to the state government.
Jewar is one of the 18 greenfield airports that have been given in-principle approval by the central government.
Some others are Mopa (Goa); Navi Mumbai, Pune, Shirdi, and Sindhudurg (Maharashtra); Bijapur, Gulbarga, Hassan, and Shimoga (Karnataka), Kannur (Kerala); and Bhogapuram airport (Andhra Pradesh).
The airport will be built in four phases. Phase 1, which will have one runway and an annual passenger capacity of 12 million, is expected to be operational by 2023 at a cost of ₹4,588 crore. NIAL is designed to handle 70 million passengers a year by the end of phase 4.
The techno-economic feasibility report for NIAL by PwC expects that the project will require equity capital of ₹8,868 crore from its sponsors, while the remaining will be raised through external debt. At least three of the four bidders have investments in the airports sector in India. GMR Infrastructure, one of the first private airport operators in India, operates the Delhi, Hyderabad, and Philippines airports. Indian-origin Canadian billionaire Prem Watsa is a majority shareholder in Bengaluru International Airport Ltd, while Gautam Adani-led Adani Enterprises Ltd successfully bid for the six public airports that were recently privatised by the government.
“Delhi-NCR definitely needs a second airport, even after the capacity expansion at the Indira Gandhi International Airport," Vijay Agrawal, executive director, Equirus Capital, an infrastructure advisory firm, said in an interview.
“Jewar is situated at a prime location and will be accessible to passengers from Agra and Lucknow as well. The government has made a large land parcel available. We will have to see how much the bidders are willing to pay the government, taking into account the tariffs charged by the Airports Economic Regulatory Authority," he said.
In October 2018, the Uttar Pradesh government had notified the acquisition of 1,239.14 hectares for the development of the Noida airport under Section 11 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The administration had to acquire 1,239.14 hectares from 3,000 farmers for the first phase, in Gautam Buddh Nagar. The government requires 5,000 hectares for the entire project.
Since 2018, investments and private participation in the airport sector has taken off in India.
Given the rapid airline passenger growth in the country, the capacity in multiple airports is being breached. With a majority of India’s population waiting to take to air-travel, growth opportunities are huge. A 2018 estimate by the research arm of credit rating agency Crisil found that the airports sector requires an investment of $45-50 billion by 2030.