Airports may get a leg-up, decision today
Airports in India would soon have leisure facilities such as golf courses, hotels, sports complex and convention centres like those in top metros around the world to improve earning of the Airports Authority of India (AAI).india Updated: Mar 17, 2011 00:07 IST
Airports in India would soon have leisure facilities such as golf courses, hotels, sports complex and convention centres like those in top metros around the world to improve earning of the Airports Authority of India (AAI).
Losses of the AAI have been increasing in the recent past with a loss of over Rs 1,500 crore in the financial year 2009-10.
AAI's expenditure is expected to be Rs 13,000 crore in the 11th plan ending in 2011-12 comapred to Rs 3,500 crore in the 10th five year plan.
In a bid to improve AAI's revenue resources, the Empowered Group of Ministers headed by finance minister Pranab Mukerjee on Thursday is expected to consider a proposal to allow commercial activity of non-aeronautical nature on airport land.
"The finance minister has already given his in-principle approval to the proposal as all hurdles have been cleared. The EGoM is expected to clear the proposal tomorrow," a senior government functionary said.
The biggest hurdle was the legal opinion.
According to officials, the law ministry has given the go ahead saying the AAI must act on business and commercial interests.
Internationally, up to 60% of the airport land can be used for commercial purposes. But, in India only 30% of that land is being used for commercial purposes.
The AAI is at present developing modern airports at Kolkata and Chennai and 31 non-metro cities.
The EGoM decision is likely to help the authority in improving its revenue stream from these airports as plans in most airports for additional commercial use of land are in place.
The civil aviation ministry's proposal says the guidelines to make the decision operational will be issued within six months in consultation with the finance ministry and the Planning Commission.
The land could be used for setting up golf courses, business parks, high-tech parks, commercial offices, sports complex and convention centers.
However, the details of which all activities to be allowed will be spelt out in the guidelines.
Whether the project will be in public-private partnership mode or totally private or totally AAI owned will be worked out before the guidelines are issued, officials said.