The modernisation of the Kolkata and Chennai international airports is expected to start soon after the ongoing Assembly elections in West Bengal and Tamil Nadu are completed.

It is estimated that the modernisation project would involve investment of Rs.7,000 crore, against which Airports Authority of India would be able to contribute only Rs.600 crore.

As earlier reported, the government is keen on taking the PPP route adopted for similar projects at Mumbai and Delhi. A special purpose vehicle for each airport would be formed with AAI holding minority stake of 26 per cent.

It is learnt that the Tamil Nadu government has already offered encumbrance-free land for the Chennai airport modernisation project.

In another development, it is learnt that the government might go in for the tariff-based bidding instead of the revenue-sharing formula. Under the tariff-based bidding, the proposed developer would quote tariffs (user charges) that would be linked to international rates. The model concession agreement would be reworked to accommodate this change.

Also See:

Kolkata, Chennai airports to upgrade soon (17-Feb-06)