"THERE are no good Plan Bs," goes the saying, "if they were any good, they would be Plan A". First passed by the Board of Directors of the Airports Authority of India (AAI) in 2003, and then left to gather dust in the Ministry of Civil Aviation's filing cabinets, the AAI "Plan for the Modernisation of Mumbai and Delhi Airports" has returned to haunt the Ministry at a time when it is struggling to fend off a major controversy.
In 1996, the Board of Directors of the AAI approached the Ministry with a proposal for the modernisation of Delhi and Mumbai airports. They argued that increasing traffic demanded that airport facilities be expanded and customer services be improved. However, the proposal was put in cold storage. The request was repeated in 1999, and, finally, a concrete plan was submitted in 2003. According to informed sources in the AAI, the request was turned down by the Ministry on the grounds that privatisation of the airports was inevitable, and hence any further investment on the part of the Ministry or the AAI was not required.
Shortly after the invitation for private bids for the "modernisation" of Mumbai and Delhi airports in 2005, the plan was taken up once more by the Airports Authority of India Employees' Joint Forum (AAIEJF), modified to bring it in line with the desired parameters for upgradation, and submitted to the Board of Directors of the AAI as the "Alternate Plan of the AAIEJF for Modernisation of Delhi and Mumbai Airports". It was reviewed by the Alternative Plan Committee of the AAI in November 2005. In effect, the AAIEJF proposal was an alternative to the privatisation option.
A copy of the plan, and the evaluation report, made available to Frontline lists out technical and financial proposals, wherein the AAIEJF explains that the AAI is a debt-free public sector utility with total assets (both fixed and liquid) of almost Rs.3,000 crores. The total costs worked out for the modernisation of Delhi, Mumbai and 35 other non-metro airports are approximately Rs.17,800 crores over a period of 10 years, a sum that can be raised by levying user development fees and borrowing Rs.9,500 crores from the market. The Evaluating Committee points out that a borrowing of this magnitude should not be difficult, given the unblemished record of the AAI.
As for the technical proposals, the plan envisions the construction of a new international terminal building and a parallel runway of 3,810 metres and the modification and expansion of existing parking bays and terminal buildings in the short term and a new domestic terminal, a second international terminal building and non-aeronautical city-side developments in the long term.
A similar plan is envisioned for Mumbai with additional augmentation of cargo-terminal capacity and increased parking bays and passenger facilities. The plan calls for a global tender for architectural and design support for the new terminal buildings to ensure "world-class" facilities. The plans can be implemented by the AAI on a departmental basis.
In its conclusions, the Evaluation Committee notes: "Concepts and details of the work proposed in the Alternative Plan for modernisation of Delhi and Mumbai airports submitted by the Joint Forum are similar to what was decided earlier by the AAI, and hence acceptable." A senior officer in the AAI, speaking on condition of anonymity, said that two independent assessments by KPMG and ABN Amro (which, ironically, was a consultant for the privatisation exercise) in 2002-03, concluded that the AAI was perfectly capable of executing the modernisation.
Ironically, page 16 of the Tenth Annual Report of the AAI, released in 2005, states: "AAI is in a position to bid for foreign projects abroad for providing consultancy services in the field of airport master planning, Communication Navigation and Surveillance (CNS) and Air Traffic Management, Terminal Management, fire fighting etc." These assessments are rather interesting, especially because the MCA considers the AAI incapable of creating "world class airports" in India.
In a reply to a question asked by Rajya Sabha Member of Parliament Dipankar Mukherjee, the MCA dismissed the Alternative Plan on the grounds that this cannot be achieved without "considerable structural changes in the manpower system of the AAI [and] attitudinal and behavioural changes on the part of the employees". While the MCA's assessment of AAI staff may be debated at length, the Ministry does raise an important question: why has the AAI not been able to build world class airports? This question provides the fulcrum on which the case for the privatisation of Delhi and Mumbai airports rests.
The answer may be found in the relationship between the Ministry of Civil Aviation and the AAI. The AAI was created by an Act of Parliament in 1996, formally granting it autonomy from the Ministry. However, senior officials allege that political interference is a way of life at the AAI. Appointments, including those of junior officers, are politically motivated, and most decisions are taken by the Ministry, not by the supposedly independent Board of Directors. In fact, the AAI did not even have a permanent Chairman from 2003 to mid-2005. During the same period, they did not even have a permanent Board of Directors - a situation that was exploited to the fullest by the Ministry.
According to the Ministry's directives, aircraft having less than 80 seats may not be charged any route navigation and facility charges, or terminal navigational landing charges - tariffs that, according to AAI engineers, constitute nearly 60 per cent of the AAI's total revenues. The Ministry, convinced that the AAI should withdraw from Delhi and Mumbai airports, is forcing the AAI to maintain loss-making airports such as Gondiya (the constituency of Minister for Civil Aviation Praful Patel) and Baramati, Union Agriculture Minister Sharad Pawar's constituency.
"If only we had true autonomy like the Delhi Metro Rail Corporation," says a Senior Engineer, "we would show the Minister what `world-class' really means."
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