Alpha Asia Managing Director Paul Topping talked to Doug Newhouse today about the Alpha-Future Group's delayed joint venture start date on its three-year-plus duty free contract at Delhi International Airport. Despite some confusing and contradictory

press reports coming out of India in the past few days, Topping says the delay is due to a technicality and is not entirely unexpected.

DOUG NEWHOUSE: There have obviously been some confusing and contradictory press reports coming out of India with regard to the concession in recent days. What is the real situation today?

PAUL TOPPING: We were awarded the contract in Delhi in November for a start date in January. That business was for operating all of the ITDC [India Tourism Development Corp-Ed] shops, plus a new arrivals shop, whilst Flemingo International's licence continues for 12 more months.

Obviously given that we knew that we were investing in India we had applied before that for Foreign Investment Promotion Board (FIPB) approval as Alpha, for investing in airports in India on retailing and food and beverage. That had been successfully obtained and we announced that had been obtained. That enabled us – as the only foreign company in the duty free sector – to have that. That gave us some confidence about the mechanism in India and obviously that side of approval requirement.

But on site when the situation is that you are granted the contract in November, we spent December liaising with various departments like customs and other approvals that were required and working closely with DIAL to ensure that the other facilities that we needed were made available for us – as well as talking to people like security, in respect of security passes.

In our minds I think the target date of the first of January was always an extremely tall order and from our point of view we didn't know when the start date would actually be – but we didn't expect that we would get in that quickly. If you just look at some of the aspects of recruitment and stock ordering, you could see that in many cases you would need a three-month period of time to get your stock from Europe, or recruit your management team.

As it happens, one of the reasons why we went for the Delhi bid in the first place was that we had a new local partner [Future Group-Ed] and in many respects that Indian partner has ready access to a whole raft of faster services – e.g. it has its own Human Resources Department and its own Systems Department and therefore in terms of the time lines, we believed that a lot of those could be shortened. From a stock ordering point of view we also obviously knew that we had a certain amount of stock in the region. So whilst we knew we would be in there not necessarily on the first of January, we knew there would be an interim period before opening.

The airport authority – or the airport company DIAL – have been extremely professional with quite a lot of senior management who have assisted us through the whole process and worked with us on many aspects. ITDC also handed over every shop when they said they were going to and have been extremely honourable about the handover. So from that point of view we couldn't have asked them to have been any better in the way that they have handled that process.

Basically through the course of February, whilst we have got the FIPB approval, a lot of these other approvals were being processed. There is a query on the basis that we have another business in India, but this business is under a different FIPB category which is permitted.

One category we are operating in is that we are investing in airports in India. The second is we have a management contract with Cochin International Airport and these are two very different categories as far as categorisation by the Indian Government is concerned in terms of seeking approvals.

So that is why we are delayed in trading, but in actual fact we always assumed we would be delayed and that is exactly where we are today.