Decision to drop privatisation of airports was taken at PM's level

However, private sector expertise will be tapped for better operations and maintenance

The Union government on Wednesday confirmed it has put on hold the decision to privatise four airports in the country and the decision was taken at PM Narendra Modi’s level. “It has been decided that Jaipur and Ahmedabad airports be managed at the operational and management levels. The proposal of privatisation of the other two airports has been dropped. We have decided these airports first go on a pilot basis,” Minister of State Civil Aviation Mahesh Sharma said.

Sharma said the decision was taken by a high-powered panel chaired by Modi on July 22. Apart from Modi and Sharma, Finance Minister Arun Jaitley and Civil Aviation Minister Ashok Gajapathi Raju were present at the meeting. “There were some representations from the two airports,” Sharma said. Civil Aviation Secretary R N Choubey explained the reason behind the move being Airports Authority of India (AAI) having invested a huge sum in the development of these airports.

“Instead of privatisation of four airports, AAI would continue to be the owner of these and at the same time, private sector expertise will be tapped for better operations and maintenance,” Choubey said. AAI has spent Rs 2,700 crore on upgrading Kolkata airport and Rs 2,400 crore on modernising the Chennai airport. AAI Chairman R K Srivastava said the authority is engaging consultants in drawing up the request for quotation and working out modalities for Jaipur and Ahmedabad airports.

Business Standard had reported on Tuesday the government has scrapped the privatisation of four major airports at - Chennai, Kolkata, Jaipur and Ahmedabad. While the airports at Chennai and Kolkata will continue to remain under the complete control of the AAI, fresh bids only for operation and maintenance contract for Jaipur and Ahmedabad airports will be invited from private players.

The National Democratic Alliance (NDA) government, after coming to power, had put the privatization of airports back on the table after there was no significant movement during the previous government's tenure. The government had proposed a public-private development of these airports which included handing over the operations, management and development of these airports to successful bidders. The applications from the private sector players were invited in December last year and the deadline was extended several times.

The move had led to protests from the airport staff as they were against the privatization of the airports which could have led to a change in their working contracts.