Foreign airport developers fail to bring value: AAI chief
Fraport and Zurich Airport deny statement
Airports Authority of India (AAI) Chairman V P Agrawal on Wednesday said foreign airport developers had failed to bring value and expertise into their Indian joint venture airports.
Agrawal’s comments, during a panel discussion at a Centre for Asia Pacific Aviation summit here, sparked a war of words, with Fraport and Zurich Airport contesting his statement.
Foreign airport operators have invested in airport projects at New Delhi, Mumbai, Hyderabad and Bangalore. Fraport holds a stake of 10 per cent in the Delhi airport and is considering an exit next year. After selling 12 per cent stake to GVK group last year, Zurich now holds five per cent stake in the Bangalore airport. Foreign companies are allowed to hold up to 49 per cent stake in Indian airport projects.
Agrawal said in 2005, foreign airports were allowed to invest in the airports at Mumbai and Delhi to bring value to these projects and use their experience in design and construction. He added if the foreign airport developers desired managerial control in Indian airports, they should commit more funds. “(Foreign) airport operators have seen it (equity in Indian airports) as an investment venture and at a proper time, made exits...So, we have had a bad experience,” he said, adding, “What we are looking at is to bring value in operational efficiency, safety and world-class norms.”
Reacting to the criticism, Christian Sigg, head of international business of Zurich Airport, said, “We are used to being silent partners and are not the ones who would put up advertisements…We still have four people on the site in Bangalore. We had eight persons on the site during the construction and the opening of the airport. We deliver mandates every day and have delivered a lot of know-how.”
Kai Zobel, vice-president (global investments) Fraport, too, dismissed the charges, saying the company did not act like a private equity investor. “Our philosophy is to be committed for a long term. In the long term, you would see our shares in the other airports where we are working. We would never act as a pure investor and always like to bring expertise to other countries,” Zobel said.