The Civil Aviation Ministry has initiated the process of handing over the Delhi and Mumbai airports for revamp to two private consortiums.
The process has been initiated following the payment of Rs 5 billion each as bank guarantees.
"The process of handing over the two airports will be complete by April," said a senior official in the Ministry.
"The consortiums of GVK and GMR have already submitted the bank guarantees of Rs 5 billion each," he added.
The modernisation process is mandated for completion in 36 months, although the Delhi High Court is yet to give its judgement on a petition challenging the award of contracts by unsuccessful bidders, the official added.
The GMR consortium has Fraport, the Frankfurt airport managers, an Indian fund and the Malaysian airport's subsidiary as its partners, while the GVK-led group has tied up with a South African airport company and a fund company from that country.
Explaining the process involved, the official said that both the airports will have a separate holding company - called a special purpose vehicle (SPV) - in which 26 per cent stake will be with the Centre and the remaining with the consortium.
"For this, a shareholder's agreement would be put in place in a couple of weeks from now," the official said, adding that the land lease for the two airports will be for 30 years with a provision for extension.
{{/usCountry}}"For this, a shareholder's agreement would be put in place in a couple of weeks from now," the official said, adding that the land lease for the two airports will be for 30 years with a provision for extension.
{{/usCountry}}The other agreements between the Airports Authority of India and the two consortiums include an operation management and development pact that will list the rights of the shareholders and distribution of responsibilities.
Officials said that the Delhi airport will need two independent runways and extended passenger facilities before March 2010 for the Commonwealth Games, while Mumbai needs to cope with the increasing cargo and traffic rate.
With the industry growing at 25 per cent as per industry estimates, and the Delhi and Mumbai airports being the two main gateway cities to India, the government wants them modernised soon, especially before the 2010 Commonwealth Games.