Zurich, Changi operators may bid to upgrade 6 small airports
MUMBAI: International airport operators, including those of Zurich and Singapore’s Changi airports, are evaluating India’s plans to privatize six airports, according to two people close to the development.
Other overseas entities that have shown interest include German airport operator Avialliance, US financial investor Global Infrastructure Partners (GIP) and Sydney-based investment manager AMP Capital, the people said, requesting anonymity. Among Indian companies, Anil Ambani’s Reliance Infrastructure, the National Investment and Infrastructure Fund and Adani group, besides Indian airport operators GVK and GMR, are likely to participate in the bidding, said one of the two people cited above.
Six airports—ahmedabad, Jaipur, Lucknow, Guwahati, Thiruvananthapuram and Mangaluru—that are currently run by the Airports Authority of India (AAI) are up for bidding. The last date for submission of bids is February 14 and the letter of award will be issued on February 28.
Redevelopment of these airports may attract investments worth $1.4 billion, according to Jagannarayan Padmanabhan, director and practice leader, transport and logistics, Crisil Infrastructure Advisory.
“Based on interactions that we have had with interested parties, each of the six airports roughly needs private investment of $200 million,” Padmanabhan said.
“Individual airports will have lower or higher investment requirements, but I believe it will be in the range of $1.2-1.4 billion that will come into the airport sector.”
A spokesperson for Flughafen Zurich AG, the operator of Zurich airport, said the company was considering a bid, but did not specify for which airports. Changi Airports International said it “continuously evaluates opportunities in airport projects” where it could add value and where there was a strong fit with its global strategy.
Spokespersons for GIP, AMP Capital, and Avialliance declined to comment.
“GVK would be interested in participating in these bids as we firmly believe in the long-term growth of the Indian aviation sector. However, we would not be able to comment on the bid terms as we are still evaluating them,” said a spokesperson for GVK.
A Reliance Infra spokesperson said the company was evaluating the opportunity, while a spokesperson for Adani group declined to comment. An email to GMR remained unanswered at the time of going to print.
In November, the cabinet cleared the privatization of these six airports under the public-private partnership (PPP) model.
At present, five airports, including Delhi, Mumbai, Bengaluru, Hyderabad and Kochi, operate under the PPP model, which not only “helped create world-class airports, but also helped AAI in enhancing its revenues and focusing on developing airports and air navigation infrastructure in the rest of the country,” the government said.