Southern States - Karnataka-Bangalore   

Work on airport to begin in Nov.

By Our Staff Reporter

BANGALORE July 8. The work on the airport at Devanahalli is likely to begin by November end, Albert Brunner, Chief Executive Officer of Bangalore International Airport Ltd., said here on Tuesday. The airport, the first to be established with public-private participation in the country, would be operational by the middle of 2006, he added.

Addressing members of the Federation of Karnataka Chambers of Commerce and Industry, Mr. Brunner said the company was likely to sign all the required agreements with the Union and the State governments by the month-end. Three agreements on land lease and grants with the State Government and a concession pact with the Centre had to be signed. The lender, ICICI Bank, would take three months to achieve financial closure after these documents were furnished to it.

He said the Union Ministry of Finance had a made a demand for the payment of concession agreement fees. Talks were on, and the issue would be settled in a week.

The first phase of the project, with a runway, commercial area, main building, car park, and so on, would come up at a cost of $ 245 million. While the State Government would invest $ 80 million, the rest would come from equity (about $ 58 million) and debt ($ 107 million).

Mr. Brunner said the company was established under Indian laws. It had taken up the project on build, own, and operate basis. The Airports Authority of India and the State Government (13 per cent each), Siemens Project Ventures (49 per cent), and Unique Zurich Airport and L&T (17 per cent each) were the shareholders. Siemens and L&T would carry out the work, while Zurich would give operational support to the airport.

To a question, Mr. Brunner said the existing HAL Airport would have to be closed down when the new airport became operational. "This (provision) is part of the original agreement. We do not doubt it (its closure).''

He said the new airport would handle about five crore passengers a year when both the phases of the project were completed. It would cater to 45 lakh passengers from 2006 when the first phase was made operational.

On air traffic control, Mr. Brunner said it was an internal matter between the AAI and the Defence establishments at this stage. The company would come into the picture only when all the players involved decided on their respective roles, and then approached it for a final agreement.

He said a month's delay in starting the project would lead to cost escalation by $ 250,000. The project was behind schedule by a year.

He said the airport, coming up on 4,300 acres of land, was only 30 km. from the city, while those in Norway and Kuala Lumpur were away from the city by double that distance.

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