GVK group wins bid for Rs 16,500 crore Navi Mumbai airport, 1st flight to take off in 2019
Indian conglomerate GVK, which operates the existing airport in Mumbai, has won a bid to develop the new airport in Navi Mumbai to ease congestion at Chhatrapati Shivaji International Airport.
Mumbai International Airport Ltd (MIAL) led by GVK outbid GMR Infrastructure Ltd – the operator of the airport in national capital New Delhi – to develop the Rs 16,500 crore ($2.4 billion) Navi Mumbai airport.
As per the bids, GMR Infrastructure Ltd offered an annual gross revenue share of 10.44 percent while GVK offered 12.60 percent share of the annual gross revenue of the project, making it the highest bidder.
Mohan Ninawe, a spokesperson for City and Industrial Development Corporation of Maharashtra (CIDCO), who had called the bids, confirmed the development.
The project will be carried out on public private partnership (PPP) basis, and CIDCO will incur pre-development work costs, which it will later recover from GVK.
“The letter of award will be issued to the selected concessioner after the approval of the state cabinet shortly,” CIDCO said in a statement. The approval process is expected to take 2-3 weeks.
The new airport is extremely crucial for Mumbai, as the existing airport has reached its saturation point of 40 million passengers.
The new airport, first proposed in 1997 and approved by the government in 2007. The project got delayed due land acquisition issues securing necessary government permissions including environmental clearance.
The first phase of the airport is expected to be operational in 2019 and will be able to handle 10 million passengers annually, the statement said.
The new airport is estimated to handle 60 million passengers by 2030 when it is expected to operate at full capacity. MIAL will operate the airport for 40 years.
Following the announcement, GVK Power & Infrastructure’s shares surged nearly 17 percent, while GMR Infrastructure’s shares fell by over 4 percent.