Jagan Mohan Reddy may review Bhogapuram airport project

VIJAYAWADA: All eyes are on the progress of another big-ticket project Bhogapuram international airport planned at Vizianagaram close to Vizag.

The new government in the state is said to be contemplating a review of the tender process for the airport project. In the tender process conducted by the previous TD government, GMR Group had emerged as the highest bidder but by the time the previous government formalised awarding the project, elections were notified.

It may be recalled that the state government had cancelled the bid bagged by Airports Authority of India (AAI) to develop Bhogapuram airport in 2017 leading to sharp criticism from various quarters. Later, the government had announced that a bigger airport with various other facilities will be developed under PPP mode.

The TD Cabinet in January last year decided to cancel the tenders that were finalised to develop Bhogapuram Greenfield International airport since there was a need to acquire more land. After the land acquisition process was completed, fresh tenders were issued. Across 2,703 acres, the scope of Bhogapuram Airport was expanded from a mere airport to an integrated airport with Aerocity, MRO, Aviation Academy etc.

In the initial tendering process AAI had emerged as the winner by offering 30.2 percent revenue share. GMR Group was the second-highest bidder by offering 21.6 percent share.

However, the Chandrababu Naidu government cancelled the entire process in January 2018 and called for fresh tenders with new rules and regulations.

A new clause was included under which the companies which wanted to construct the airport project were required to have experience in real estate development.

Instead of the revenue sharing method, the government asked the bidders to pay fee as per passenger traffic.

GMR Group, which emerged as winner, offered `303 per passenger and GVK Group offered `202 per passenger.

Reliance Airport Developers, Essel Infraprojects, Fairfast India Holdings, National Investment and Infrastructure Fund had also participated in the process.

“The international airport proposal at Bhogapuram had also been put forth before the diplomats who had attended the state government’s Diplomats Outreach Programme held on August 9 seeking investment which means the government will call for a fresh tender,” said a senior government official.