Indian Govt. plans to privatize 13 airports by March 2022

indian govt

Finance Minister NirmalaSitharaman, in her budget speech, said that the government is planning to privatize airports operated by AAI from Tier II and III cities in 2021-22.

The government plans to complete the privatization process for 13 airports run by the state-owned Airports Authority of India (AAI) by March 2022."We have sent a list of 13 airports to the aviation ministry that are to be bid out on PPP (public-private partnership). The plan is to complete the bidding of these airports by the end of this fiscal," said Sanjeev Kumar, AAI chairman, in an interview.

AAI has decided to merge seven small airports with six big ones—Varanasi with Kushinagar and Gaya; Bhubaneswar with Tirupati;Amritsar with Kangra; Raipur with Aurangabad; Indore with Jabalpur; and Trichy with Hubli.The per-passenger revenue model will be applied for the bidding,and the airports will beon offer for 50 years. Underthe National Monetisation Plan, the Indian government aims to privatize 25 airports in the next four years, including the above 13.Also,Finance Minister NirmalaSitharaman, in her budget speech, said that the government is planning to privatize airports operated by AAI from Tier II and III cities in 2021-22.

AAI's earnings dropped considerably due to the coronavirus pandemic as it recorded a huge loss of Rs 1,962 crore in FY21 and was pushed to borrow Rs 1,500 crore from the State Bank of India to meet working capital requirements, including salaries. However, with the improvement in the Covid situation and passenger traffic picking up, it will not need to borrow capital this year.