Cabinet approves FDI worth Rs 15,000 crore from promoters for Bangalore Airport expansion

Bangalore International Airport (Representative image)

The Cabinet Committee of Economic Affairs has approved a Foreign Direct Investment (FDI) proposal worth Rs 15,000 crore by Anchorage Infrastructure Investment Holding Ltd.

Anchorage Infrastructure is the investment vehicle of Fairfax India for airports and other infrastructure investments.

Fairfax India is the majority owner and controller of Bangalore International Airport Ltd as it owns a 54 percent stake in the airport.

The FDI is a part of Fairfax India's plan to invest around $2.2 billion in Bangalore International Airport to create infrastructure to handle around 90 million passengers by 2034.

The investment includes the transfer of the government's stake in Bangalore International airport to Anchorage.

It also includes an investment of Rs 950 crore in Anchorage Infrastructure Investment Holding Ltd by Ontario Inc. The latter is a wholly owned subsidiary of OAC, the administrator of OMERS, one of Canada's largest defined benefit pension plans.

The government has been keen to attract more FDI into infrastructure and said the investment will be a major boost to not only the infra space but also the construction and airport sectors.

It said the investment will considerably substantiate the Government of India's plan to develop a world-class airport and transport-related infrastructure through private partnership.

"It is also expected to be a significant boost to the recently announced National Monetisation Pipeline (NMP), as it will help fund leasing out of state-owned infrastructure assets which involves handling assets like roads, railways, airports, sports stadiums, power transmission lines and gas pipelines to private operators," it said.
The investment will also lead to direct employment generation as the sector in which Anchorage Infrastructure is proposing to make downstream investments is capital and employment-intensive sector. The investment will also generate indirect employment during construction and ancillary activities.