AAI has suffered Rs 27.31 cr losses on Gondia airport project: CAG

National airports operator AAI has incurred accumulated losses to the tune of Rs 27.31 crore in the period between April 2009 to March 2015 on Gondia airport project, even when no commercial flights are operated or scheduled for operations from the airport, according to a CAG report.
The Comptroller and Auditor General of India (CAG) in its latest report --Union Government (Commercial) no 15 of 2016 --has also observed that till date an expenditure of Rs 201.84 crore, of which Rs 198.9 crore are from the Government budgetary fund, has been incurred for development of Birsi airport at Gondia in Maharashtra.

"Government budgetary funds (Rs 198.8 crore) was used to develop Birsi airport Gondia with the objective of supporting a private flying training institute. The revenue earned by Airports Authority of India (AAI) from this institute was insufficient to meet operation and maintenance cost of the airport.
Even with utilisation of airport infrastructure by another institute, it failed to generate enough revenue to cover the running cost of airport," the CAG report said.
Meanwhile, AAI established another institute at Gondia for better utilisation of the airport facilities, it said adding, "However the institute could not fulfill its objective or utilise the airport infrastructure. This left AAI with recurring losses; the cumulative losses incurred by AAI on Gondia airport during April 2009 to March 2015 being 27.31 crore."

Ministry of Civil Aviation had in 2005 intended to set up a flying training institute with development of an airport through government budgetary support.

The detailed project report for the project estimated a total cost of Rs 230.01 crore, with Rs 118.52 crore for setting up the flying institute and Rs 121.39 crore for development of Birsi airport at Gondia, it said.
Subsequently, (November 2007), MOCA decided that AAI would develop the Birsi airport with budgetary support and flying training institute would be constructed, developed and maintained by a private joint venture company, the CAG said.
While approving the Government budgetary support for the project, MOCA directed (November 2007) that the recurring cost of the airport be borne from the AAI resources, the report said.