NEW DELHI (INDIA): Airports Authority of India (AAI) plans to put in place regulations for flexible use of land parcels as part of asset monetisation efforts, as it prepares for large scale upgradation of airport infrastructure.
The national airports operator, which manages 125 aerodromes including civil enclaves, is awaiting amendments to to the AAI Act that would allow effective monetisation of land assets.
Sources said the proposal to amend the Act whereby certain provisions would be included with respect to land assets and their utilisation has already been floated.
In this regard, a draft Cabinet note has already been circulated for inter-ministerial consultations and the process is at a “very advanced stage”.
An amendment to an Act has to be approved by the Parliament.
AAI owns around 55,000 hectares of land in urban areas across the country. Under the current norms, airport land could be used only for limited purposes.
According to sources, once the Act is amended AAI would make its own regulations on flexible use of land. Having those norms would also help in expediting the overall approval process, they added.
“Flexible use of land needs to be allowed as the market conditions as well as utilisation patterns are dynamic and needs to be reviewed at least every ten years,” a senior AAI official said.
Already, the land assets are being monetised at some airports including at New Delhi and Mumbai — both of which are run by consortiums with AAI being a stakeholder.
In the case of Delhi international airport, around 10 per cent of the land assets on the city side has been monetised while it is around 5 per cent at Mumbai international aerodrome, sources said.
Presenting the Union Budget for 2017-18 last week, Finance Minister Arun Jaitley said the AAI Act would be amended to enable effective monetisation of land assets.
“The resources, so raised, will be utilised for airport upgradation,” he had said.
Last week, aviation Minister Ashok Gajapathi Raju said AAI could monetise around 2,000-3,000 acres of its land and utilise the funds raised in airport infrastructure development.
AAI’s non-aeronautical revenue currently account for around 19 per cent of its annual top line. In 2015-16 fiscal, the national airports operator saw its profit after tax jump nearly 30 per cent to Rs 2,537.36 crore.
During that period, total revenue touched Rs 10,824.50 crore.
Source: Press Trust of India