After winning a bid to operate six airports, the Adani Group has been awarded three airports – Thiruvananthapuram, Jaipur and Guwahati – which will operate under a public-private partnership (PPP) model. The Union Cabinet on Wednesday approved the proposal to lease out these three airports.
In February 2019, the Adani Group had won a controversial bid to operate six airports – Lucknow, Ahmedabad, Jaipur, Mangaluru, Trivandrum, and Guwahati. In July 2019, the Union Cabinet approved the lease for the Ahmedabad, Lucknow and Mangaluru airports to the Adani Group. Though the conglomerate had won the bids to the remaining airports as well, the government had not handed them over to the private firm back then.
The six airports, which the Adani Group will now manage and operate, are owned by the Airports Authority of India (AAI). Though opposition parties and central trade unions have been opposing the privatisation of airports, the Centre has gone ahead with the privatisation of these national assets.
In February 2019, in a letter to the Civil Aviation Minister, Centre of Indian Trade Unions (CITU) General Secretary Tapan Sen had said: “All these six airports have been modernised through huge investment from public exchequer under the supervision of Airport Authority of India and the quality of modernisation of these six airports are no way inferior, if not superior, to that made in the airports, of Delhi, Mumbai, Hyderabad and Bangalore under private sector operators, thereby decisively proving competence and capability of the public sector Airports Authority of India.”
In February 2019, about 10,000 AAI employees had observed a strike in protest against the privatisation of six airports, under the banner of Airports Authority Employees Union (AAEU).
Amid these protests, the Rajya Sabha passed a Bill on July 16 last year. It allowed the Airports Economic Regulatory Authority of India (AERA) to bid out any new airport at a pre-determined tariff structure.
Kerala Government Opposes Privatisation of Thiruvananthapuram Airport
The centre has been facing resistance from the Left Democratic Front Government in Kerala against the privatisation of the Thiruvananthapuram Airport. Soon after the Centre’s in-principle approval, the state government approached the Kerala High Court. It challenged the AAI’s arbitrary and illegal attempt to opt for a private entity for the management of the airport.
The state government has been pointing out that the AAI’s move to hand over the airport to Adani Group was a violation of provisions of the AAI Act and the property rights of the state government.
The Kerala Government has been opposing the Adani Group's involvement since the furore began. The state government had even moved the Supreme Court challenging the AAI, which granted the bid, stating that the company had no previous experience in handling airports. This was in violation of the Airports Authority of India Act, 1994, the state government had argued.
Shortly after the Centre’s decision on Wednesday, the Kerala government urged Prime Minister Narendra Modi to intervene and reconsider the decision, saying it would be “difficult” for the state to cooperate in implementing the decision.
“In view of the unilateral decision taken by the Government of India without giving credence to the cogent arguments put forward by the State government, it will be difficult for us to offer co-operation to the implementation of the decision, which is against the wishes of the people of the State,” Vijayan said in a letter to Modi.
“I request your good self to intervene at this stage so that the decision taken now is reconsidered,” he added.
The Kerala CM pointed out that the decision was taken “ignoring the repeated requests” of the state government to entrust the management of the airport with the special purpose vehicle (SPV) “in which state government is the major stakeholder”.
Vijayan said the Civil Aviation Ministry had in 2003 given an assurance that as and when the induction of a private player was considered, the Centre would factor in the state government's contribution to the development of the airport.
The Kerala government had earlier transferred 23.57 acres of land to the AAI free of cost for construction of the international terminal, “subject to the condition that the value of the land would be reflected as Government of Kerala’s share capital in an SPV which would be set up”, Vijayan said in the letter.
In a meeting of the empowered group of secretaries, convened by the NITI Aayog in 2018, the state government had elaborated on details of public funds spent for acquiring the land.
“The pertinent point raised by the state government is that it has proven experience in successful management and operation of airports in Kochi and Kannur, which the private bidder lacks. We had requested de-linking the Trivandrum International Airport from the proposal to operate in PPP mode or allow the SPV of the State government to have the right to first refusal in order to match the quote of the highest bidder. None of these has been considered,” Vijayan said.
The ruling Left and the opposition Congress had also lashed out at the Centre over its decision to lease out three airports to the Adani group, accusing it of privatising all PSUs while the country was battling COVID-19.
In a letter to the PM, Communist Party of India (Marxist)’s Rajya Sabha Member Elamaram Kareem also urged the Centre to withdraw the decision to handover the airport to the Adani Group.
“The Government of Kerala has repeatedly requested the Centre not take such decision and has made a proposal to entrust its operations to the Special Purpose Vehicle (SPV) in which state government is the major stake holder. Unfortunately, the Centre rejected this proposal and moved forward with its decision of privatising. Through this the Airport which is functioning profitably and its land assets of around 635 acres, majority of which is given by the state for free of cost, will be given to the private player for 50 years,” Kareem said in the letter.
“You may also note that this particular company doesn’t have any proven experience in the successful management of an international airport where the Government of Kerala is successfully running the Kannur and Kochi airports. This was not even considered by the Central Government,” he added.
The Kerala government called for an all-party-meeting on Thursday to discuss and protest against the Centre's decision. The meeting, called by Vijayan, will be held at 4 p.m. through video conferencing, a statement from the CMO had said.
With Inputs from PTI