Navi Mumbai airport finally gets wings: GVK inks deal with Cidco

GVK Power and Infrastructure (GVKPIL) on Monday said it has signed a concession agreement with the City Industrial Development Corporation (Cidco) to create a special purpose vehicle (SPV) for developing the long-delayed Navi Mumbai International Airport.

GVK, through its subsidiary Mumbai International Airport (MIAL), holds 74 per cent equity shares of the SPV Navi Mumbai International Airport (NMIAL) while Cidco holds 26 per cent, the company said in a statement. MIAL runs Mumbai's Chhatrapati Shivaji International Airport.

The initial concession period is 30 years from the appointed date which is extendable for a further 10 years, it said.

''With the continued support of the Centre and Maharashtra government, Cidco and all our stakeholders, we are confident of creating and delivering the much needed second airport for the twin cities of Mumbai and Navi Mumbai,'' the company's chairman and managing director GVK Reddy said.

The first phase of the airport is expected to be operational in 2019 with a capacity to handle 10 million passengers a year. By 2030, an estimated 60 million passengers are expected to use the facility .

The company is currently carrying out pre-development works like levelling the earth. The rehabilitation and resettlement of 3,500 residents is yet to come through.

During the bidding last year, four bidders - GMR Airports, MIAL, MIA Infrastructure Ltd (a joint venture of Tata Realty and VINCI Airport Concessions) and Voluptas Developers (a consortium of Hiranandani Group and Zurich Airports) were short-listed, but the last two withdrew from the fray, leaving only GMR Airports and MIAL.

GVK was awarded the airport project in October as MIAL offered a higher annual gross revenue share of 12.60 per cent in comparison to GMR Airports' offer of 10.44 per cent.

The estimated cost has quadrupled to Rs16,000 crore since 1998 when it was first conceptualised. The airport will be built on 1,160 hectares in public-private partnership mode.