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Be it Congress or BJP, two sides of same coin on Privatization of Airports

Last year, the central government had invited bids from private players to operate these airports for 50 years on a public-private partnership (PPP) basis.

The Airports Authority of India (AAI), which currently manages these airports, in February 2019, announced the bids received from nine companies for privatisation of six airports including Lucknow, Mangaluru and Ahmedabad. Adani Enterprises outbid other companies for all six of these airports.

On Thursday, Kerala’s Finance Minister Thomas Isaac said Kerala government’s claim to managing the airport was rejected even after it offered to match Adani Enterprises’ bid.

 As per AAI, for the Thiruvananthapuram airport, it received a per-passenger fee bid of Rs 168 from Adani, while Kerala State Industrial Development Corporation Ltd (KSIDC) bid Rs 135.

In his letter to the PM, Vijayan wrote: “In my letter dated 10.06.2020, the request to hand over management and operation of the Trivandrum International Airport to the SPV in which the State Government is the major stake holder was reiterated. This has not been considered and the present decision has come even while the litigation in this regard is pending before the Hon’ble High Court of Kerala as per the direction of the Hon’ble Supreme Court”.

“We’ve raised strong objection against the decision to entrust a private party with the management of the airport,” Thiruvananthapuram’s Mayor K Sreekumar said.

The letter by K Sreekumar emphasises the major role played by the state in establishing the airport by handing over the land free of cost. It also highlights the government’s successful handling of the PPP model airports in Kochi and Kannur while pointing out that Adani group doesn’t have any proven experience in the field.

The congress leader and MP from Kerala  Shashi Tharoor took an stand against the political tide with which his own party is moving by commenting “The people of Thiruvananthapuram want a first-class airport worthy of the city’s history, status and potential. In this context, a decision, however controversial, is preferable to the long delay we have suffered.”

The assessment of any private company on their functions by taking economies of scale the major goal requires the responsible Governments to look into their own duties.

The Privatization of Airports is not new, we can find its traces way back in 2013 but it was a half-hearted deliberation of the then UPA government to discourage the Monopoly by a few.

The bid in 2013 mendated by the then Civil Aviation Ministry and Planning Commission to curtail monopoly by saying that no bidder would be allowed to take more than two of the six airports – Chennai, Kolkata, Ahmedabad, Lucknow, Jaipur and Guwahati – that are on the block.

Even out of these six, a single player could not win more than one out of Chennai, Kolkata and Ahmedabad.

While restrictions are being imposed on new players, there is no such bar on GVK and GMR. Rather, they are being put at an advantage with the SAARC criteria.

The other disputable attempt is to keep AAI totally out of the new companies that will run the six airports after privatisation. When the Delhi and Mumbai airports were privatised, Airport Authority of India was given a 26 per cent stake in the companies that were formed to take over management of these airports.

In the second innings of privatisation, the Manmohan Singh government proposed to allow private players 100 per cent equity in the new ventures. This means AAI will have no share in the profit that these companies generate.

Also, AAI (as a government representative) had no place in the board of directors, leaving no opportunity to question partisan decisions by the management of such companies in day-to-day operations.

The government planed to introduce the ‘Golden Share’  concept to give AAI the power to intervene, but this can happen only in the case of major issues and that too when they come to light.

The CPI has then condemned the privatisation bid and the UPA government had neither taken AAI employees nor political parties into confidence before plunging into the next round of airport privatisation.

Then also CPI’s D Raja and JD (U)’s Sharad Yadav (a former civil aviation) minister had written to the Prime Minister, but the government had not responded to their pleas.

Now, at an all-party meeting in Kerala, all parties barring the BJP, have come out unanimously against the Centre’s decision giving charge of Trivandrum International Airport to Adani Enterprises. The all-party meet has decided to move a resolution in this regard in the state assembly when it meets for a day on August 24.

Pinarayi said it would be difficult for an entrepreneur to manage the airport without the cooperation of the state government.

“In case of development, the cooperation of the state government is a necessity. We don’t think anyone would be interested in doing business challenging the state. We all are together in this protest against the decision,” he said.

Meanwhile, Civil Aviation Minister Hardeep Singh Puri said the Kerala government had not qualified the bidding process that was carried out in a transparent manner.

“Winning bid quoted to Rs 168 per passenger, KSIDC quoted Rs 135 per passenger and third qualifying bidder was at Rs 63 per passenger”, Puri who took to Twitter to clarify the Centre’s stand on the airport’s 2019 privatisation process, said.

Per passenger fee was the criteria for the bidding process that was conducted in early 2019 for the six airports and Adani Enterprises was the highest bidder.

Tushar Singh Sengar
A writing enthusiast and a keen observer. Through this platform i have envisioned to deliver authentic stories and information of public importance.

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