Merchant airports on backburner

Is the government’s much-touted merchant airports proposal on the backburner? The government, it seems, isn’t too keen on investing its own money heavily into the project and is currently concentrating on the 35 non-metro airports.

The merchant airports were proposed for towns such as Durgapur, Gwalior, Jhajjar, etc, under a private-public partnership (PPP) model, with the government even allowing 100% foreign direct investment in them. But M Madhavan Nambiar, secretary at the ministry of civil aviation, said in Kolkata on Friday, “At present, we are concentrating on non-metro airports. Because of recession, the government hasn’t got a good response for merchant airports from private infrastructure developers.”

He added, “The government is not too keen to invest heavily in merchant airports, especially if it is the Airports Authority of India money. We welcome international partners…”

Nambiar said that traffic generated at the airports wasn’t living up to the projected figures and so, there was a need for all the stakeholders — airlines, airport operators, etc — to market them. He said the civil aviation ministry is holding talks with state governments on issues plaguing airports.

“We are doing a review of the investments made in airports. What is required is a ground study on the issues and required incentives…We need to talk to international experts,” Nambiar said.

Both traffic and revenues are down due to the downturn. “The revenue stream and sustainability will be lost if the airports are not marketed,” he said. “In Hyderabad and Bangalore, the new airports have been set up through the PPP model, which means revenue loss for the government there as well,” Nambiar added.

He said existing facilities must be utilised fully.