Builders wary of bidding for Navi Mumbai airport

The bidding process for appointing a developer for the Navi Mumbai airport at Panvel could be delayed owing to the delay in declaring the number of flights that will operate from the new airport. Soubhik Mitra reports.

The bidding process for appointing a developer for the Navi Mumbai airport at Panvel could be delayed owing to the delay in declaring the number of flights that will operate from the new airport.

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Prospective bidders for the city’s second airport in Panvel want the state government to give an assurance about the number of flights that will operate from the new airport to ensure viability of the project.

The City and Industrial Development Corporation (CIDCO), the promoter of the Navi Mumbai airport, will soon take this up with the state government. “If we get the in-principle approval, it will be taken up with the civil aviation ministry,” said Tanaji Satre, managing director, CIDCO.

In January, CIDCO had set a June deadline to start the process of appointing a private developer by floating tenders. Sources said that the process is likely to get delayed by at least two months. “CIDCO fears that the project could have few takers unless the government guarantees some business in advance,” said a senior official with state government undertaking.

Sources told the HT that there have been several rounds of informal discussions about the issue in the bureaucratic circle. However, the deadlock is likely to delay the tendering process for the new airport. “It is a serious issue. Potential developers could drop out,” said a senior analyst with an aviation consultancy firm. “Traffic sharing between an existing and new airport in the same city is common across the world. For a multi-crore project, it is fair if developers demand a nominal business guarantee,” added the expert.

If the bidding process fails to kick off immediately, the airport could miss its 2014 deadline.

TC Benjamin, principal secretary, urban development ministry, said, “We want to reduce the project’s risk value. Assuring some mandatory traffic could be one of them. The decision would be taken on the basis of discussions with airlines and other stake holders.”