Examine the developments of Airports in India through Joint Ventures under Public-Private Partnership(PPP) model. What are the challenges faced by the authorities in this regard? (150 words)
India has witnessed significant developments in its airport infrastructure through joint ventures under the Public-Private Partnership (PPP) model. This model has enabled the creation of world-class airports, improved service delivery, and attracted private investments to supplement public funds. Currently, India has five PPP airports in Mumbai, Delhi, Cochin, Hyderabad, and Bengaluru, handling over 55% of the country’s air traffic.
Challenges faced by authorities:
- Increased charges: Higher charges at PPP airports have been a contentious issue for airlines and passengers.
- Capital expenditure: A clear process for determining capital expenditure and monitoring project costs has not been established, leading to budget overruns in some cases.
- Economic regulation: There is room for improvement in terms of economic regulation, land monetization, and management of project costs.
- Operating environment: Creating a more predictable operating environment on issues such as bilateral policy and airspace efficiency is necessary.
- Land acquisition and clearances: Delays in land acquisition, clearances, and shifting of utilities have adversely affected PPP projects.
To overcome these challenges, lessons from the PPP experience should be factored into future projects, and a more predictable operating environment should be created. Additionally, establishing a clear process for capital expenditure and monitoring project costs can prevent budget overruns and ensure the continued success of the PPP model in India’s airport infrastructure development.
