GMR and GVK win in India

By Administrator |

India?s Civil Aviation Minister Praful Patel has announced that GMR Industries/Fraport has won the rights to modernise Delhi Airport, while the GVK group and its Airports Company of South Africa partner has won Mumbai Airport

(Bombay).
Both groups will now take 74% shareholdings in the two airports, with the state-controlled Airports Authority of India (AAI) retaining a 26% stake.
The announcement brings a three year privatisation plan to its seeming conclusion, although nothing is ever what it appears to be in India. Technically the Indian Cabinet still has to approve both deals which are fiercely opposed by the government?s coalition partners and the trade unions.
So much so that hundreds of airport workers staged protests outside India?s major airports, including Delhi, Mumbai and Calcutta yesterday and leaders of the AAI union have promised that more than 20,000 AAI employees will strike.
Civil Aviation Minister Praful Patel has sought to reassure workers that their jobs are safe under a three year agreement with both consortia, but the workers remain unhappy. Patel added that the two consortia had promised to absorb 60% of the workforce after the three-year period, and the AAI would absorb the rest.
All of which comes at a time when Delhi and Mumbai are creaking at the seams following the 25% growth in air passenger traffic over the last year alone. The modernisation of both airports which have double the number of take offs and landings they were designed for, is expected to cost IR.54bn ($1.24bn).
GMR-Fraport and GVK-ACSA (Airports Company of South Africa) outbid rivals Reliance and ASA Mexico, India's DS Construction and its partner Munich Airport and Australia's Macquarie group with partner A?roports de Paris.
In its winning bid for the Delhi business, GMR-Fraport offered the government a 45.99% revenue share, while the GVK-led bid offered a revenue share of 38% for Mumbai airport.

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