Aug. 5 – The Civil Aviation Ministry of India plans to convert the Airport Authority of Indian (AAI) into a public company as a way of raising funds.
The ministry will amend the laws contained in Airport Authority of India Act, the principal act governing various airports in India. By converting the AAI into a public company, funding will become easier and the AAI will be able to raise money from the primary and subsequently from secondary market. The amendment is expected to be placed before the parliament by 2010.
At present, the AAI is modernizing major airports in Kolkata and Chennai as well as 35 regional airports within the country and has huge property holdings across the country. The authority is also planning to spend US$2.6 billion on airport modernization over the next three years. The financing for these developments will be done through internal resources and borrowing by the AAI.
Out of the 125 airports managed by the AAI only 86 are operational. Only 15 airports in India turned a profit in 2007-08. By converting the AAI into a public company the government plans to bring a major up-gradation through public money.
