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Ashwini Phadnis

New Delhi , June 27

THE Government will allow the successful consortium bidders for the restructuring and modernisation of Delhi and Mumbai airports to undertake building activities directly related to facilitating passengers or development of air services.

This emerged after the Ministry of Civil Aviation sought the Attorney General's advice on the kind of development activity that should be allowed at these two metro airports, official sources told Business Line.

"If some one were to build a airport hotel or shopping area, there should be little objection. However, there may be issues if some one were to build a technology park," a senior Government official said.

The transaction document that is to be made available to the bidders shortly will specify that they will be allowed to use 5 per cent of the total area earmarked for the new airport in Delhi for commercial development, while in the Mumbai airport, 10 per cent of the total area can be used.

The total area specified for commercial development is in keeping with the bylaws of the States where the airports are located.

On whether the Government's decision to put the responsibility of removing encroachments at the Mumbai airport on the bidders would act as a deterrent to those participating in the process, sources said it would not affect the modernisation process.

"The issue was discussed with the bidders and they were willing to remove the encroachments themselves, provided some State help and support was made available," the official said.

The Government has received bids from eight consortia including Reliance, L&T and GMR and it hopes to identify two successful bidders for both the airports by September.

The empowered Group of Ministers recently cleared the transaction document on the basis of which eight short-listed parties are to submit their bids.

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