The project, a joint venture between the Airports Authority of India, GMR group and three other partners, has been mired in controversy.
NEW DELHI: The financial closure of the Delhi International Airport Ltd (DIAL) project is expected within the next few weeks.
The project, a joint venture between the Airports Authority of India, GMR group and three other partners, has been mired in controversy after AAI raised objections over the GMR group seeking deposits for commercial development on part of the airport land.
The financial closure was initially slated for July this year, but in the absence of a decision on the Rs 2,250 crore (which is to be mopped up through deposits), it has been hanging fire.
Perhaps irked by the delay in deciding on the deposits issue, GMR has decided to plug the gap to get the Rs 8,900 crore airport development project (for phase one) back on track.
Speaking to DNA Money, DIAL Director G Subba Rao said, “Regardless of whether deposit money is okayed or not, financial closure will happen in December. We can raise debt and increase equity exposure to the project to meet the Rs 2,500 crore-shortfall in case deposits are not allowed.”
While Rao did not say that hiking debt would make the project unviable, his comments come just when the attorney general has put its stamp of approval on raising deposits (Rs 50 crore per acre for the 45 acres of land it is initially putting up for commercial development by private developers), saying this plan does not violate the OMDA (Operation, Management and Development Agreement) signed between the JV partners.
As per OMDA, the first phase of the project should be completed by 2010. GMR has already invited bids for commercial development and Rao said the deposit money would be redeployed to the airport-side development of the project.
Meanwhile, senior civil aviation ministry officials said that with the attorney general’s view in favour of raising deposits, a green signal to the process should be given soon.
“We did not oppose the concept of security deposits. What we questioned was the quantum of deposits DIAL is seeking. Now let the market forces decide that,” the officials said, adding the attorney general’s view would be treated as final.
According to estimates, passenger traffic at Delhi is expected to increase from 16.1 million in 2006 to 82.6 million by 2026.
Which is why DIAL is projecting capacity to handle 37 million passengers by 2010 (when the first phase of development gets over) to 100 million by 2026.
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