KATHMANDU, JUL 13 -
Even as the dust kicked off by the government’s alleged handover of the Tribhuvan International Airport (TIA) to an Indian Company, Infrastructure Leasing & Financial Services Limited (IL&FS) is yet to settle, there are now documentary evidence that the same company has also proposed the development and up-gradation of operational aviation infrastructure at 15 other domestic airports of the country.
The IL&FS in its letter to Investment Board (IB) on December 21, 2011 had proposed to enter into an ‘Airport Development Agreement’ with either Civil Aviation Authority of Nepal (CAAN) or the Ministry of Tourism and Civil Aviation (MoTCA) to jointly develop, finance and implement and maintain airports in Nepal on Build, Own, Operate and Transfer (BOOT) model.
This is the same letter where IL&FS has proposed the Investment Board for development and up-gradation of TIA on public private partnership (PPP) basis. “Taking into consideration IL&FS’s financial strength and experience in implementation of infrastructure projects on PPP basis, we request you to give us an opportunity to partner the government in developing a world class airport in Kathmandu,” reads IL&FS letter to IB. The Indian company in its letter has asked the IB to accept the letter as its ‘expression of interest’ (EoI) for TIA up-gradation.
The IL&FS has proposed establishing special purpose vehicles (SPVs) for this purpose jointly with CAAN/MoTCA. As per IL&FS proposal, there will be two such SPVs, — Airports Development SPV and Airports Implementation SPV.
“The Airports Development SPV shall be responsible for the identification and development/redevelopment/planned up-gradation of the airports,” reads IL&FS letter. “This SPV will have IL&FS and CAAN/MoTCA as co-promoters with minor equity requirement from each.”
The letter further states, “The Airports Implementation SPV will be responsible for the financing, implementation and maintenance of individual airports.”
The Indian company has planned to undertake a comprehensive appraisal of the existing facilities at each of these airports within 6-9 months from the date of signing the agreement. The letter shows, IL&FS plans to develop these airports in line with its investment plan spread over a maximum of 30 years.
The domestic airports for which IL&FS has shown interest are, Surkhet, Lukla, Jumla, Nepalgunj, Biratnagar, Chandragadi, Pokhara, Jomsom, Tumlingtar, Bhairahawa, Simara, Lamidanda, Dhanagadi, Janakpur and Bharatpur. Most of these airports are being upgraded by the CAAN, the regulator.
Meanwhile, the Supreme Court on Thursday asked the government to furnish detail project report (DPR) of the TIA up-gradation. According to CAAN, the DPR was prepared by the Asian Development Bank (ADB), which has provided $ 80 million assistance ($70 million loan and $10 million grant) to the government for the project. The government has also invested $30 million in this project. The IL&FS held informal discussions with CAAN on the matter two months ago.
The IL&FS EoI says the TIA needs new domestic passenger terminal building, new international terminal building, new international apron, relocation of existing international airport apron closer to building, new access road to new international terminal building and multi-level car park, among others, to reduce apron congestion.
The Indian company estimates around $ 600-700 million will be required for entire up-gradation and modernization in and around TIA.
Source: http://www.ekantipur.com/2012/07/13/editors-pick/tia-mgmt-handover-row-ilfs-seeks-domestic-airport-mgmt/357038/
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