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Airport winners not to get all Bipin Chandran & Suveen K Sinha / New Delhi February 20, 2006 GVK, GMR can match highest bid for new Mumbai, Delhi airports. The winners of the government's contracts to modernise the Delhi and Mumbai airports will not be the automatic choice for modernising any new airport that may be constructed in these cities or in their vicinity in the future. In a change inserted into the "request for proposal" document, the government has made it clear that bids will be invited for any new airport in either city and the existing contract holder will have to compete along with others. But, if the existing contract holder's bid is within 10 per cent of the highest bid, it will get a chance to win the contract by matching the highest bid. That, only if its performance in the execution of the current contract has been satisfactory, with no material default. The change was inserted late last year, when the bidding for Delhi and Mumbai was on. According to the earlier provision, existing contract holders could automatically, if they wanted, get to execute new airport projects by offering the government the same share of revenue as in the existing projects. Only if it refused, a bidding was to take place. The condition to the first right of refusal was to protect the business interests of private sector consortia executing the Delhi and Mumbai airports modernisation project. **A new airport in the vicinity will obviously eat into the business of an existing one.** The government wants to build a new airport in Mumbai by 2015. There has been talk regarding building another airport in Delhi too, mostly focused on Greater Noida, a satellite town. However, there is no firm deadline for it. The GMR-Fraport and GMR-South African Airports consortia have bagged the contracts to modernise the Delhi and Mumbai airports, respectively, after protracted, fierce and controversial bidding. ---------------- The Civil Aviation Ministry may need to accelerate the thought -- and experimentation -- given to the emergence of multi-airport systems in the country without waiting till plans for Mumbai and Delhi to be firmed up. They can start by negotiating the revocation of the clause in the agreements with L&T/Siemens and GMR/Malaysia to close Bangalore HAL and Hyderabad Begumpet when BIAL and HIAL are ready. These airports must be designed to operate in tandem with the new ones OVER THE LONG HAUL. The same would hold true for the multi-airports for Mumbai and Delhi. Most importantly, Mopa plans must be re-cast along the same lines (after revoking the Cabinet resolution to close Dabolim when Mopa is ready). It is only in this way that new airports wont be planned so as to put old ones out of business overnight. This will also curb the tendency to build new airports as Taj Mahals with luxury hotel-lobby interiors. Passengers will end up paying through their nose for such extravagant facilities. Btw, we also dont want to see old airports converted into highly elitist civil enclaves for the use of defence/families and VVIPs/families while forcing aam admi to crawl to distant greenfield airports.
