MIAL pipped GMR group to bag the Navi Mumbai airport project offering higher revenue share in February
Bids not finalised and award letter not issued since cabinet is yet to approve it. A state government committee will meet next Wednesday to recommend the bid for approval
The first phase of Rs 16,000 crore project is expected to be complete by December 2019. Aviation experts however call this deadline unrealistic
Pre-development works for the project began in June but the government sat on the proposal to select the developer for eight months delaying the project further. Both the bidders have been asked to extend their bank guarantees given along with bids till November as final approval has not been given yet.
The airport project has been in the planning stages since the 1990s but has faced delays and roadblocks in land acquisition and environmental clearances.
CIDCO managing director Bhushan Gagrani reiterated the first phase of the airport will be operational by December 2019. The airport will handle 10 million passengers in its first phase and is seen as an alternative to the constrained airport of Mumbai. Aviation experts, however, believe the 2019-end deadline to be unrealistic.
A GVK spokesperson said there is unnecessary and unwarranted speculation regarding delays in the bid award. “ We are the successful bidder and hence expecting our bid to be honoured. We are also confident of achieving the financial closure.”
GMR group did not offer comments.
The airport project is being carried out in a public-private partnership with the selected bidder having 74 per cent stake with CIDCO holding the remainder in a special purpose vehicle (SPV). The bid condition allows the majority shareholder in the SPV to rope in another investor but it is restrained from diluting its stake to below 51 per cent for seven years.
CIDCO will bear the cost of pre-development works valued over Rs 3400 crore and the amount will be treated as a loan to the project developer. On Cidco’s immediate agenda are flattening a hillock, reclaiming marshland and diverting a river.
CIDCO's joint managing director Prajakta Lavangare said the pre-development works are progressing smoothly and the agency expects to complete them by next December. “ We have accepted demands of project affected persons regarding rehabilitation and government order too has been issued,” she added.