Aviation Min yet to complete pact for airport privatisation

The much touted airport privatisation drive of the UPA 2 government that seeks to offload 100 percent stake held by Airports Authority of India across six airports to private developers could face minor delays. Sources told CNBC-TV18 that the model concession agreement (MCA) – that lays down the rules of engagement between the government (AAI) and private parties – is yet to be finalized. The delay is on account of the aviation ministry having to prepare the MCA from scratch after having rejected the draft MCA prepared by planning commission member Gajendra Haldea late last year.

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Sources say that while the revenue share model in the MCA for the private developers have been finalised it is still awaiting legal vetting. “The MCA has not been finalized yet. We still need to get it legally vetted which would take around 15 days more,” a senior official in the aviation ministry told CNBC-TV18. The official added post the legal vetting the MCA would be sent to an inter-ministerial group followed by a final cabinet nod. “Can’t say at this stage whether the entire process of privatization would be completed by May or June but we are striving to get it done,” the official quoted above said.

A fortnight back aviation minister Ajit Singh had told CNBC-TV18 that he was hopeful of completing privatization for the six airports by March 2014. The delay in preparation of the MCA means the shortlising of the final participants for privatization may have to be extended. As per the plan the aviation ministry is looking at privatizing the airports of Chennai, Kolkata, Lucknow, Ahmedabad, Guwahati and Jaipur.