GMR, GVK, L&T qualify for next stage of bids for new Kushinagar airport

Gammon Infrastructure Projects, GVK Developmental Projects, GMR Infrastructure and Larsen and Toubro have passed the first stage of bids to build the Kushinagar international airport. GMR was rated the highest, on financial and technical capacity. Kushinagar is about 60 km west of Gorakhpur, in eastern Uttar Pradesh.

The four are now eligible for the second stage, the deadline for applying to which ended this month.

The department of tourism, Government of UP (GoUP), had invited applications from interested bidders early this year for upgrading an existing airstrip to an international airport at Kushinagar and integrated fevelopment of a ‘Buddhist circuit’, covering the Buddhist heritage sites of UP, on a design-build-finance-operate-transfer (DBFOT) basis. About 41,600 foreign tourists visited Kushinagar during 2008, according to the department.

After evaluating the financial and technical capacity of the bidders, Hyderabad-based GMR Infrastructure was rated the highest by the evaluating committee. GMR was awarded 387 marks on its technical capacity and had the highest weighted average net worth of Rs 12,424.3 crore in the financial capacity category. L &T came a close second in technical capacity and scored 290 marks, while GVK had the second highest weighted average net worth, of Rs 5,685.97 crore.

The marks were awarded on the basis of the experience of each company in operating, commissioning and constructing airports. The minimum net worth of the applicants had to be Rs 300 crore at the close of the preceding financial year.

GMR said, “We are always looking out for good opportunities in the Airport Authority of India’s regional airport privatisation initiatives. How and when we bid depends on the right fit with our business model.”

A notable absentee from the list of bidders for this first stage was Reliance Infrastructure (R-Infra). A senior executive from R-Infra had earlier said the company was interested in bidding for airports with some existing infrastructure, not in erecting new ones.

The existing functional airstrip of the UP Civil Aviation Authority at Kushinagar is about 97 acres, with the need to acquire 453 acres of more land from 12 villages around the airstrip. GoUP proposes to build the airport in a public-private-partnership mode, on the DBFOT basis. The project consultant is IL&FS Infrastructure Development Corporation.

Some of the proposed project components are development of 550 acres of land allotted for operational purposes, commercial development of land spread over 50 acres in Kapilvastu and 200 acres of additional land adjacent to the airport provided for real estate development.

One incentive offered for the bidders would be the possibility of optional development of the airstrips at Sankisa and Shravasti into domestic airstrips that can handle 50-seat or 60-seat aircraft, with development of land parcels of 30 acres at each location. However, the land value will have to be paid by the developer.