GMR pips others in bidding for greenfield Bhogapuram airport project

V Rishi Kumar Hyderabad | Updated on February 26, 2019 Published on February 26, 2019

GMR Infrastructure Limited has outbid several others in the fray including GVK, Doit for the proposed greenfield Bhogapuram airport project.

The bids for the airport project were opened on Monday wherein the diversified infrastructure company offered Rs 303 per passenger as against DOIT Smart Infrastructure which offered Rs 261 and GVK Rs 207, respectively per passenger to the Government.

Ajay Jain, Principal Secretary, Energy, Infrastructure & Investments, Andhra Pradesh Government, told Business Line “in the bids we opened, GMR offered the highest amount as passenger fee to the Government and thereby outbid others.” “This is as per the new norms which the Government has adopted to encourage private sector players to develop airport infrastructure in the country. This is similar to what even Airports Authority of India has adopted,” he explained.

The entire process of finalising the bid wrests with the State Government. Once the bids are approved by the Board of Andhra Pradesh Airports Development Corporation, which is the nodal agency for development of airports in the State, these will be forwarded to the Government and after the State Finance Ministry approval, put up for the State Cabinet nod. The entire process may take about 2-4 weeks, before awarding the contract to the highest bidder, in this case GMR with highest offer per passenger.

The earlier bid process as cancelled by the State Government after it decided to invite fresh bids with new terms, including development of a MRO and training facilities. In the first bid process AAI had won with GMR being the unsuccessful bidder. Then the approach was based on revenue share as a percentage of the revenue as against per passenger fee set now. As per the plans, the winning developer has to complete the Rs 2700 crore project within 36 months.

Of the seven bidders only three filed their proposals before the February 22 deadline set by the State. Reliance Airport Developers, Essel Infraprojects, Fairfax India Holdings and National Investment and Infrastructure Fund, did not file their bids before the deadline. The State Government has identified land at Bhogapuram in Vizianagaram district close to the port city of Visakhapatnam. The current airport is used both by civilians and Navy.

The Government had mandated that the project would have capability to handle 18 million passengers per annum, when completed over three phases. While the Phase one will cost about Rs 2700 crore, the total project cost was estimated at Rs 4208 crore.

Published on February 26, 2019
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