The Central government plans to create separate subsidiaries for airports in major cities to attract private investors for the modernisation of non-metro airports.

While AAI will operate these airports, private parties will be allowed to develop and manage city-side projects such as hotels, malls and other entertainment centres.

Nagpur, Lucknow, Ahmedabad, Bhubaneshwar and Amritsar airports are likely to be change as separate corporate entities as government expects them to be developed through public-private participation model by offering them significant equity stakes in these airport firms.

While the airside of 35 non-metro airports will be exclusively developed by AAI, private parties have been allowed to take part in the city-side modernisation of these airports. The airside modernisation is likely to entail an investment to the tune of Rs.5,500 crore, whereas city-side development is estimated to cost Rs.1,500 crore. The civil aviation ministry will soon be inviting expressions of interest from private parties for modernising the 35 non-metro airports.

Also See:

Non-metro airports upgarde: Consultants soon (09-Oct-06)