Navi Mumbai Airport Concession Agreement: An Overview

The Navi Mumbai airport concession agreement has been a topic of discussion in the aviation industry for quite some time now. Recently, the Maharashtra government announced that GVK-led Mumbai International Airport Limited (MIAL) has been awarded the contract to build and operate the Navi Mumbai International Airport (NMIA) for a period of 30 years.

The Navi Mumbai airport, which is expected to be completed by December 2023, is being developed on a public-private partnership (PPP) model. The project is estimated to cost around Rs 16,000 crore, and will be built on 1,160 hectares of land.

Key Highlights of the Concession Agreement:

1. Term: The concession agreement is for a period of 30 years, with a provision for extension of another 10 years.

2. Concession Fee: MIAL will pay a fixed concession fee of Rs 277 per passenger, which will be escalated at a rate of 5% per annum.

3. Revenue Sharing: The concessionaire will share the airport`s gross revenue with the government of Maharashtra. The share will be 12.6% for the first 10 years, 14.6% for the next 10 years, and 16.6% for the remaining years of the contract.

4. Land Lease: MIAL will lease the land on which the airport is being built from the City and Industrial Development Corporation (CIDCO) for a period of 60 years.

5. Construction and Operations: MIAL will be responsible for the design, construction, financing, operation, and maintenance of the airport.

6. Passenger Service Fees: MIAL will collect Passenger Service Fees (PSF) from passengers using the airport. The PSF will be Rs 400 for domestic passengers and Rs 1,200 for international passengers.

7. Cargo Service Fees: MIAL will collect Cargo Service Fees (CSF) from cargo operators using the airport. The CSF will be Rs 1.50 per kg for domestic cargo and Rs 4.50 per kg for international cargo.

Conclusion:

The Navi Mumbai airport concession agreement is a significant development in the aviation industry. The project is expected to boost the economy of the region and provide better connectivity to travelers. The concession agreement is designed to ensure that the project is financially sustainable and profitable for all the stakeholders involved.

As the project progresses, it will be interesting to see how MIAL manages the construction and operations of the airport, and whether it is able to meet the high expectations set by the Maharashtra government. Nevertheless, it is a step in the right direction for the growth and development of the Indian aviation industry.