Govt to complete privatisation of 13 airports by end of FY22

The government plans to complete the privatisation of 13 airports run by the Airport Authority of India (AAI) by the end of FY22.

Chairman of AAI, Sanjeev Kumar, told the media that they had sent the list of 13 airports to the Ministry of Aviation that is to bid out on the public-private partnership (PPP) model. The target is to complete the privatisation by the end of FY22.

It will use the per-passenger revenue model for the bidding. This model was previously used, and the Jewar Airport was bid out on the same model.

AAI decided to merge seven small airports with six big airports, including Varanasi with Kushinagar and Gaya, Amritsar with Kangra, Bhubaneswar with Tirupati, Raipur with Aurangabad, Indore with Jabalpur and Trichy with Hubli.

Under the government's National Monetisation Plan (NMP), it has planned to award 25 airports within four years, along with the 13 airports. It follows the six awarded airports to Adani in 2019 during the beginning of the second phase of privatisation after Delhi, Mumbai, Bengaluru and Hyderabad were handed over in 2005-06.

The government wants to liberalise the sector with the privatisation of these airports. AAI mandate will be expanded for developing new airports where the private sector may not venture through revenue earned from the airport privatisation.

AAI's earrings were affected due to the Covid-19 pandemic. It witnessed a record loss of Rs 1,962 crore in FY21 and borrowed Rs 1,500 crore from the State Bank of India (SBI). With the pandemic situation normalising and the passenger traffic increasing, AAI will not require to borrow for working capital needs this year. Last year the capital expenditure was Rs 2,100 crore, and it borrowed Rs 1,000 crore.

Image Source

---

Also read: AAI approves privatisation of 13 more airports