Maharashtra government is commencing the process of choosing a developer for the Rs 16,000 crore Navi Mumbai airport project. The process of selection is happening eight months after a tender picked the GVK group to be most suitable for the award.
In this regard, the chief secretary of project monitoring and implementation committee, Sumit Mullick will take forward the bidding procedures of the GVK group, to seek final approval of the state government. Upon cabinet approval, the letter of award will be issued to the developer and a concession agreement will be signed subsequently.
GVK group led Mumbai International Airport Limited (MIAL) beat the GMR group to win the project by offering a higher revenue share to implementing authority City and Industrial Development Organization (CIDCO).
As per Bhushan Gagrani, MD of CIDCO, the first phase of the airport will be functional by December 2019. The currently constrained airport of Mumbai will handle 10 million passengers in its first phase. However, aviation experts believe that the deadline of December 2019 is unrealistic.
“We are the successful bidder and hence expecting our bid to be honored. We are also confident of achieving the financial closure,” as stated by a GVK spokesperson.
The entire project of the airport is carried out in a public-private partnership with 74 percent stake of the winning bidder and rest by CIDCO, which holds the rest in a special purpose vehicle (SPV). Under the bid criteria, the majority shareholder in the SPV allows another investor to be roped in. However, it restricts from diluting its stake to less than 51 percent for 7 years.
“We have accepted demands of project affected persons regarding rehabilitation and government order too has been issued,” said CIDCO’s joint managing director, Prajakta Lavangare.