Public-private partnership (PPP) isn't really a partnership at all in the case of Indira Gandhi International (IGI) Airport. Delhi International Airport Pvt. Ltd (DIAL), a consortium led by the GMR group, actually 'socialise' the losses and privatise the profits. CAG's (Comptroller and Auditor General) 2016 draft revenue audit, accessed by DNA, revealed that the government lost Rs 2,397 crore in this airport from non-aeronautical services in the last six years.
Under the PPP contract, DIAL had agreed to share 45.99 per cent of its gross revenue with Airports Authority of India (AAI), a government agency in the private-public partnership. But CAG's draft revenue audit shows that DIAL has not honoured the revenue-sharing and other terms and conditions.
DIAL has formed 11 joint ventures to run non-aeronautical operations, and its agreement with these JVs provided from 10 per cent to 61 per cent sharing of gross revenue on contract. AAI has been deprived of this revenue as per terms. In 2009, the UPA government allowed DIAL to recover Airport Development Fees (ADF) from passengers. CAG sources said DIAL collected more than Rs 3,500 crore from ADF and diverted this amount to cover project costs - which it was supposed to arrange from other sources like banks. However, more than one-fourth of its capital cost was paid by the passengers.
DNA had sent a mail to GMR, but they did not respond till the time of going to press.
Now, the GMR-led operator of IGI airport is saying that it has no money to fund mandatory security expenses at the airport. Sources said that DIAL is trying to hike charges to pay the security personal. This is not the first instance of financial mess in DIAL operations. In 2012, CAG carried out a performance audit and found anomalies in the so-called PPP mode of development.
DIAL is a joint venture consortium of GMR Group, Airports Authority of India (AAI) and German firm Fraport. In January 2006, DAIL was awarded the contract to operate, manage and develop IGI Airport in a competitive bidding process. In April 2006, DIAL entered into a Operation, Management and Development Agreement (OMDA), and in May 2006, the AAI handed over IGI airport to DIAL and gave it exclusive rights to operations, maintenance, development and management of the airport.
In 2006, the Ministry of Civil Aviation projected an additional Rs40,454 Cr for modernisation of the existing airport -- at the time when the OMDA and State Support Agreement were being considered. Interestingly, all this was taking place in the absence of any regulator.
DIAL IN
- 1996: Modernisation of Delhi Airports considered by AAI
- 2003: Government approved long term lease by joint venture with 74 per cent equity of private consortium and 26 per cent of AAI
- 2005: Bid submission made by GMR-Fraport and others
- 2006: EGoM awarded Delhi Airport to GMR-Fraport
- 2008: AERA (Airports Economic Regulatory Authority Of India) bill passed in Parliament
- 2009: Airport Development Fee (ADF) was fixed
- 2010: AREA appellate tribunal established
- 2011: CAG report on DIAL tabled in Parliament
- 2015: CAG issued letter to Ministry of Civil Aviation for further meaningful audit
- 2016: Ministry replied to CAG saying AAI should ask for records and documents
- 2016: CAG confirmed that audit had initiated an exercise (July to August 2015) to certify revenue collections of AAI from DIAL.
- 2017: DIAL says it doesn’t have money to pay CISF
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