Premium
This is an archive article published on September 19, 1998

Karnataka Govt told to renegotiate with Tatas

NEW DELHI, SEPT 18: After inordinately delaying clearance for proposed international airport in Bangalore, the Civil Aviation Ministry to...

.

NEW DELHI, SEPT 18: After inordinately delaying clearance for proposed international airport in Bangalore, the Civil Aviation Ministry today asked the Karnataka government to renegotiate with the Tatas who have backed out of the project.

In an obvious attempt to ward off any blame for the Tatas’ withdrawal from the project, the ministry announced that “all outstanding issues have been resolved in principle.”

After a meeting with Karnataka CM JH Patel and Defence Minister George Fernandes, Civil Aviation Minister Ananth Kumar emphasised that the “ball is now in the court of the State government.”

Story continues below this ad

“I told Patel to have a time-frame for renegotiation with the Tatas. I hope that he has taken the message in its proper and urgent sense,” he remarked.

The joint meeting also decided to constitute a three-member committee with representatives from the Airports Authority of India, the Karnataka government and the Tatas.

Kumar said that issues relating to the extent of land required for the airport, thelanding and parking fees, the nature of the consortium which will be a joint venture in perpetuity, the share of traffic between the proposed airport and the existing HAL airport were resolved in principle.

“The share of traffic will be in such a way that the Tatas would find the project viable. We have an open mind on this issue,” he said.

Story continues below this ad

After the three-member committee will complete the task of finalising the modalities for the execution of the project, Kumar, Patel and Fernandes will have a “kick-off” meeting to set it in motion.

At the meeting, civil aviation ministry officials apprised the Defence Minister of issues relating to integrated aerospace management of the three defence airports at Yelahanka, Jakkur and HAL and the proposed Devanahalli international airport all falling within a radius of 60 km.

Kumar described the meeting as “fruitful,” while the fact is that the Tata-led consortium which is to execute the project have officially withdrawn from the project. The memorandum ofunderstanding signed by the Karnataka government with the consortium in fact expires on September 30.

Earlier in the morning, Patel met Prime Minister AB Vajpayee and submitted a memorandum complaining of delays by the Centre in giving the go-ahead for the project. “Although concrete decisions were arrived at on all the major issues in the inter-ministerial meeting held under the chairmanship of the former Civil Aviation Secretary, the subject was not taken to the Union Cabinet.”

Story continues below this ad

Patel also told Vajpayee that the proposed tripartite meetings (of the Civil Aviation Ministry, the state government and the Tata consortium) which were to be held within 30 to 45 days of the meeting held between him and Kumar had not been convened. “Instead, there were press reports attributed to the Civil Aviation Minister stating that HAL would not only continue to operate civilian traffic but would also be upgraded and expanded to handle international traffic,” he said.

Meanwhile, the Tatas refuted Kumar’s comments atthe economic editors’ conference yesterday that its proposal on starting an airline was not clear on the composition of foreign institutional investors’ equity.

Tatas had indicated that American Insurance Group and the Government of Singapore Investment Corporation had evinced interest in picking up stake but clarified that such a move would be only as per government guidelines.

“Tatas also clarified that both AIG and GIC did not have airline shareholders,” the statement said.

Story continues below this ad

“It therefore strains credibility for the minister to say that the ministry was seeking information about possible links between possible investors and a foreign airline,” the statement said.

Latest Comment
Post Comment
Read Comments
Advertisement
Advertisement
Advertisement
Advertisement