NEW DELHI, 5 April 2006 — Ignoring opposition from left parties and airport employees, the Congress-led United Progressive Alliance government signed two agreements yesterday for modernization of Delhi and Bombay airports. The modernization of Delhi airport has been handed over to the GMR group, a leading construction firm based in south India, and its German partner Fraport. A similar contract for Bombay airport has been won by another leading construction company, GVK, along with Airports Company of South Africa (ACSA).
The government’s decision to lease the two airports to private companies was announced in January. Though the left parties and the airport employees, fearing loss of jobs, protested strongly against this decision, the government ignored them. Just as the pacts were being signed yesterday at Ashoka Hotel, airport employees took out a procession and staged a demonstration outside the Civil Aviation Ministry’s headquarters at Rajiv Gandhi Bhawan. Police and additional security were deployed to prevent violence.
Announcing the signing of the agreements, Civil Aviation Minister Praful Patel said: “The OMDAs (operations, maintenance and development agreements) and the shareholder agreements have been signed. The JV (joint venture) companies are in place.”
OMDAs and the shareholders agreements were signed by Airports Authority of India chief K. Ramalingam and AAI Director V.D.V. Prasada Rao in the presence of Patel and Civil Aviation Secretary Ajay Prasad.
With modernization of airports stalled due to lack of funds, the government has sold its entire 74 percent stake. AAI, which runs 130 airports in the country, will keep its 26 percent stake in both airports.
The process of transition will take a week after the two groups pay the initial deposit of 1.5 billion rupees each, Patel said.
Regarding the concerns voiced by left parties, Patel said: “We have made it clear that the issue of Delhi and Mumbai (Bombay) airports cannot be revisited and there is no room for negotiations on this front.”
Without commenting on the case filed by the Reliance Group (of Anil Ambani) against the modernization process in the Delhi High Court, Patel said the court had “permitted” the government to proceed with the signing of the two pacts.
“We have the provisional license to operate the airport,” said G.V. Krishna Reddy, CMD of the GVK Group who signed the agreement. On when would the airport actually be handed over to them, he said: “The ball is in the government’s court, but I believe they are planning to do this as soon as possible.”
The Communist Party of India (Marxist) strongly criticized the government for signing the agreements. “Making a mockery of transparency, the signing of the agreements have taken place at a point of time when charges of irregularity are still under judicial scrutiny,” the party Politburo said in a statement.
The party also described the agreements as a “violation of the commitment of the government given to the AAI employees that all, issues including the modernization of airports, will be discussed in a government-AAI employees tripartite committee.”
