Revving up

01 Jun 2010 Editorial Team

The recent tragedy at the Mangalore airport had a 30-year-old history when a major disaster had been averted. Union Law Minister, M Veerappa Moily, had a miraculous narrow escape at the Mangalore airport then. At a function on May 10 this year to inaugurate the New Integrated Terminal building at the Mangalore airport, Moily recalled that fateful day on August 19, 1981, when an Avro aircraft that he was travelling in, landed at the Mangalore airport with barely a few hundred feet of the runway left. All passengers had survived then.

Instead of building a modern, greenfield airport with infrastructure large enough to handle bigger aircraft like the Boeing B737-800 or Airbus A320 without risks of such kind, only the upgradation of Bajpe Airport was on the government's agenda. Airport infrastructure is of prime importance for connectivity but it has to have basic safety and standards.

The Civil Aviation Minister informed at an aviation meet that about $200 to 300 billion would be required in the next 10-15 years for development of aviation infrastructure in India. The airport construction is likely to see tremendous growth. Our cover story unveils the Indira Gandhi International Terminal 3 which opens to public on 3rd July in Delhi. This will further pave the way for showcasing our infrastructure for the Commonwealth Games in October. After 1982, we are just about getting prepared for a sporting event of this size and that too in the same city while it could have been a potential opportunity to showcase another city. But somehow such missed opportunities are the obvious losses due to the inefficiency in the bureaucracy. Who would have thought that building 45 cricket stadia in India could bring in revenue for the city where they are built; but the IPL and other events have brought revenues to tier 2 cities, and one such city could have benefitted.

Property prices in the residential segment have been quite robust and several builders have converted their commercial projects to residential to ride the gravy train. DLF's 90-storeyed twin towers announcement and Lodha's bid of Rs 4,000 crore for a 25,000 sq m plot in Wadala (along with a right to develop the adjoining recreational ground of 67,000 sq m) are robust steps in this direction. Yet the prices of realty stocks are not keeping pace with indices and seem to be out of favour with the funds. The reasons are well explained by a fund manager and I quote, "It's no secret that no investor has any trust in any of the numbers put out by realty stocks, whether it's the value of their assets or their revenue and profit numbers. Unlike other sectors, this is true not only of the smaller companies but also of the largest realty companies." The realty companies need to make amends if they wish to be part of the housing revolution that is on the anvil.