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This is an archive article published on June 29, 2004

GoM clears airport revamp for take-off

The Empowered Group of Ministers on the restructuring of Delhi and Mumbai airports today approved the Civil Aviation Ministry’s earlier...

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The Empowered Group of Ministers on the restructuring of Delhi and Mumbai airports today approved the Civil Aviation Ministry’s earlier announcement of putting a 49 per cent cap on FDI and also cleared the proposal to allow a maximum of 10 per cent participation by scheduled Indian carriers.

Besides private domestic airlines like Jet Airways and Air Sahara, this category also includes national carriers.

The GoM also cleared the changes in the document requesting expressions of interest but gave added emphasis to absorption of AAI employees by the private consortium.

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The Ministry has committed to a timeframe of eight months with December 31 as the deadline for the project to be handed over to the new joint venture companies.

At its first meeting today, the GoM also approved the selection of Air Plan Australia as the global technical advisor (GTA) for this multi-crore project. Amarchand Mangaldass has been appointed as the legal consultant.

The GTA will have a crucial role to play in setting design standards for the shortlisted consortiums and then assisting the GoM in assessing the designs submitted by these parties for final selection.

Headed by Defence Minister Pranab Mukherjee, the GoM includes Finance Minister P. Chidambaram, Law Minister H R Bhardwaj and Civil Aviation Minister Praful Patel.

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Official sources said the GoM has favoured the move to give additional weightage during the final selection to bidders who propose greater absorption of AAI employees.

In fact, shortlisted bidders will now be asked to submit detailed plans for absorption of AAI employees along with their proposal for restructuring the airports.

This, sources said, is separate from the decision to make it mandatory on the selected party not to lay off existing employees for a minimum of three years and to absorb a minimum of 40 per cent employees after the lay-off period.

With the GoM’s stamp of approval, officials said, the restructring process has finally come on track after the uncertainty caused by the change of government.

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‘‘The first GoM meeting was important to learn the policy direction of the new government. But with all proposals being approved, it is unlikely that there will be any mid-course correction now,’’ said an official.

However, the Airports Authority Employees Union protesting the entire project has formed a joint forum with the help of other associations. In a bid to present a united opposition, the forum claims it will work independently with financial contributions from affiliated organisations and donations from members.

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