Govt. defends decision that led to Adani bagging six airports

The Ministry of Civil Aviation on Thursday asserted that the Centre’s decision to dispense with a cap on the number of airports a single entity could bid for — a move that paved the way for Adani Enterprises Ltd. (AEL) to emerge as the highest bidder for six AAI airports — had been taken on considerations of operational scale.

AEL has signed concession agreements to take over the Lucknow, Ahmedabad, Jaipur, Guwahati, Thiruvananthpuram and Mangaluru airports, after the Centre decided to privatise them.

“The EGOS (Empowered Group of Secretaries) took a conscious decision not to put any restrictions on the number of airports to be bid for or to be awarded to a single entity considering the fact that these six airports are smaller in size, handling only 9.5% of the passenger traffic whereas Delhi and Mumbai airports accounted for more than 45% of the total passenger traffic in 2006 when they were brought under PPP and the decision to cap one airport to single bidder was necessary,” the Ministry said in a statement.

The ministry added that the quantum of passengers handled by private airport operators was ‘crucial and [more] important than the number of airports handled by a single entity’.

In 2019, the Department of Economic Affairs had recommended a two-airport cap per bidder citing the capital intensive nature of the airport projects.

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