The group tied up a Rs 10,300 crore loan for the project last July. YES Bank is the lead lender for the project. However, two months on, the airport developer is yet to give L&T an authorisation to proceed with the work. The loan disbursal, too, has not happened as the resettlement of the families is yet to be undertaken.
A senior executive of YES Bank, however, said there is no desire to hold back the funding. “It is just a question of clearances getting signed off,” he said.
“If you look at the whole site in Navi Mumbai, there are some tenements that needed to be cleared. That is in the last stage. As soon as that is done, I think funding will start,” he said. “We are the lead banker and stay committed to the project,” he said and added that the recently announced investment into GVK group’s airport business will bring greater liquidity.
The Navi Mumbai airport, an alternative to the congested airport at Mumbai, is being developed in a public-private partnership between GVK and the City and Industrial Development Corporation (CIDCO) of Maharashtra. The project has seen time and cost overruns due to delays in land acquisition and environment ministry approvals.
The first phase project cost is pegged at over Rs 14,000 crore and will be funded through equity investment and Rs 10,300-crore long-term debt. The airport will have a capacity to handle 10 million passengers annually in the first phase.
The GVK group won the bid to develop the airport in February 2017. The concession agreement between GVK and CIDCO was signed in January 2018. While Maharashtra chief minister Devendra Fadnavis had said the airport would be ready by December 2019, the concession agreement set 2021-end as the project completion deadline.
The Navi Mumbai airport
site is spread over 1,160 hectares consisting hillock, river, marshland and 10 villages. While CIDCO has already reclaimed the land and increased the land site to 5.5 metres, L&T will increase it further to eight metres before construction of the runway and other terminal facilities. That work is now stuck for the past couple of months.
A CIDCO spokesperson said the agency cannot comment on questions related to third party. She added that 90 per cent of the rehabilitation and resettlement of affected residents has been undetaken by CIDCO. “We have 100 per cent consent of all project affected persons for the project,” she added. L&T declined to comment.
While 2,400 families have already been shifted, around 200 from Ulwe and Kombadbhuje villages are still negotiating with CIDCO for better amenities and higher compensation.
CIDCO has offered all affected families developed plots in an area adjoining the airport site and 18 months rent for transit accommodation. An official said discussion was on with villagers and a resolution is expected in 8-10 days.
GVK, too, expects the pending pre-development work to begin within the next fortnight and the first task will be to cut the hillock and increase the land height to eight metres. “The process of giving authorisation to L&T to start the work is on,” a source said.