Maytas to build two regional airports

A consortium of three companies led by Hyderabad-based Maytas Infrastructure, which won the bids to develop airports at Gulbarga and Shimoga in the state, plans to spend Rs 200 crore over the next seven years on the two projects.

The consortium of Maytas, Nagarjuna Construction Corporation (NCC) and VIE India Project Development and Holding LLC, on Wednesday signed a project development agreement with the Infrastructure Development department of the state government.

As per the agreement, the consortium will develop and operate airports at Gulbarga and Shimoga on a Build-Operate-Transfer basis. Special purpose companies will be set up for the two projects. While Maytas and NCC will hold a 37 per cent stake each in the two companies, VIE will hold the balance 26 per cent.

The airports will be constructed over 24 months from the date of signing the agreement and the concession period is 30 years and extendable by an additional 30 years.

Karnataka's Infrastructure Secretary V P Baligar said the airports will eventually lead to airside and landside development, which will include construction and development of runway, terminal and ancillary buildings. "Once the projects start, the two cities will witness construction of hotels, convention centres and technology parks," he contended.

Maytas Infrastructure Vice Chairman Teja Raju said the consortium would invest Rs 50 crore on each of the two airports in the first phase.

"Only ATR aircraft can land at the two airports once the first phase is completed. We expect three weekly flights to fly to these airports to begin with. It could reach as high as 10 weekly flights. We intend to break even six years from the date of commissioning the two airports," he added.

Raju pointed out that domestic airlines were consulted by the consortium. "The airlines have evinced interest in flying to these cities. We expect the air passenger traffic to increase in the next two years. We are working out the details of the plans," he added.

The consortium will be given 695.45 acres on a lease at the rate of Rs 15,111 per acre (lease amount) for every year in Gulbarga. While 567 acres are already in the possession of the government, the remaining land has to be acquired.

In Shimoga, the consortium will be given 662 acres at the rate of Rs 20,232 per acre (lease amount) for every year. While 527 acres are in the possession of the government, the rest have to be acquired.

Raju said the consortium was keen on developing other smaller airports in the country. "There is a proposal to develop smaller airports in Udaipur, Amritsar and Visakhapatnam. We will bid for all these projects," he stated.