Tatas may invest in Navi Mumbai airport
The aviation ministry recently allowed the Navi Mumbai airport, to be built through public-private partnership (PPP), to raise 26% of its equity from airlines against the 10% allowed in PPP airports.business Updated: Aug 17, 2014 22:54 IST
The Tata Group, which holds stakes in two Indian carriers including a majority in the soon-to-be-launched Vistara, has asked the government to reconsider a rule that bars airlines investing in the Navi Mumbai international airport project from holding a board seat.
The aviation ministry recently allowed the Navi Mumbai airport, to be built through public-private partnership (PPP), to raise 26% of its equity from airlines against the 10% allowed in PPP airports.
Tata’s have argued that any airline or its associate that would infuse capital investment of Rs. 19,000 crore or more would want to secure its investment.
“We request you to consider allowing at least associate companies of scheduled airlines or cargo airlines to appoint directors on the board in proportion to their equity,” Sanjay Ubale, MD and CEO, Tata Realty and Infrastructure Ltd, said in a letter to secretary Ashok Lavasa.
“This clearly shows they are interested in investing in the project,” an aviation ministry official said.
“We have consistently expressed our interest in development of the Navi Mumbai Airport. At this stage we have no information to share,” the Tata Group said in response to an email from HT.
“Any schedule airline… who would infuse capital investment to the tune of `19,000 crore or more, would certainly be interested to ensure that its investment is secured and therefore would require to actively participate in the company’s affairs,” Ubale wrote, adding this would require active participation in the company’s affairs including day-to-day decisions taken by the board.
To evade fears that such a move could be detrimental to other airlines, Ubale wrote that the Competition Commission of India “will always ensure equal status to all airlines” and airports are bound to function in accordance with International Civil Aviation Organisation and International Air Transport Association guidelines.
First Published: Aug 17, 2014 22:49 IST