State govt scales down Kushinagar project

This has been done by mainly cutting down on the land that was to be given as an incentive in Kushinagar and Kapilvasti to the private developer and also some of the infrastructure at the airport such as passenger boarding bridges and the cargo terminal. Even the area of the main terminal building has been reduced from 18,000 square metres to 6,250 square metres.

Initially,the government had offered to give a minimum of 200 acres of land in Kushinagar city and Kapilvastu on lease to the developer as a sweetener. When the private players said this land was not enough to compensate for their huge investment,the government decided to go in for viability gap funding to the extent of 20 per cent of the estimated cost of Rs 650 crore. But still the potential developers had reservations. Now,the government has decided to scale down the project and apply with the government of India for up to 20 per cent viability gap funding. That is not all. The government has also accepted the private players’ objections to its projection of passenger traffic: it has been reduced from four lakh passengers per year earlier to 2.5 lakh. Mainly,the expected footfall of international tourists,estimated at 3.2 lakh earlier,has been reduced to 1.9 lakh.

The government has also relaxed the basic eligibility criteria for private players. Earlier,it was mandatory for the bidder to have developed an airport in the past.

Now any developer who has taken up projects in core sectors such as ports and highways can apply provided the applicant has a minimum net worth of Rs 49 crore.

The idea of constructing an international airport in Kushinagar on a public-private-partnership model was conceived in 2008 as part of the plan to develop the Buddhist tourist circuit in eastern UP. This is one of the few projects for which the Uttar Pradesh government has got the go-ahead from the Centre,including environment clearance,and green light from the civil aviation department and the defence ministry. The government has also acquired about 540 acres of land for the main airstrip.

But the project failed to enthuse private bidders who regarded it as “non-viable”. Initially,big names such as GMR,Larsen and Toubro,Gammon India Ltd and GVK Power and Infrastructure Ltd had expressed interest but when the details were revealed none of them appeared for the bidding.

Tourism Secretary Manoj Kumar Singh said,“With modifications and restructuring,we are hopeful that the viability of the project will improve.”