What the Left glosses over: how AAI benefits

Left: AAI is a profit-making PSU capable of carrying out modernisation, why go for private participation?

• The investment for the first two years at both airports is estimated at Rs 5200 crore (approx) and Rs 14,000 crore (approx) over the next 20 years. AAI’s current reserves are just Rs 1200 crore and if used up, other airports will suffer.

Left: Delhi and Mumbai are main profit centres. Its privatisation amounts to killing AAI financially.

• With 45.99 per cent (GMR) revenue share in Delhi and 38.7 per cent (GVK) in Mumbai, AAI is estimated to have a revenue of Rs 180 crore (Delhi) and Rs 140 crore (Mumbai) based on its current revenue from both airports. Add to this, the aeronautical revenue, its dividend income (26 per cent), share from upfront fee and annual lease rentals. It will make the same net profit and this will increase as the JVs perform better. Further, its investments come down and so does the wage bill.

Left: Employees will be retrenched and their interests will be overlooked by private players.

• Firstly, no change will take place for initial three years. Both bidders have agreed to subsequently absorb 60 per cent employees (bid condition was minimum 40 per cent). About 10 per cent employees will continue to work for AAI in these airports and 7-8 per cent employees are expected to retire by 2009. The rest will be absorbed by AAI and posted at other airports. In sum, no retrenchment.

Left: Alternate plan by AAI joint employees forum was not taken seriously through the bidding process, which is legally ‘‘not tenable’’.

• Alternate plan was evaluated and scored less than 50 per cent in the technical evaluation, not making the cut even after revisions by the EGOM to the bid document. The project was a rehash of what AAI had proposed in 2000.