IRB Infrastructure to develop Sindhudurg Airport

IRB Toll Plaza, source: Infrastructure Developer’s bid for the Sindhudurg Airport has been accepted. The Maharashtra Industrial Development Corporation (MIDC), the special planning authority for the project, has selected it, said the company in a release to the BSE. The airport operator will have to design, build and operate the airport. Financial terms have not been disclosed on sharing of costs and revenues.

The airport project cost indicated by MIDC was Rs 150 crore at the time it invited bidders to get pre-qualified. This was in February 2009. The concession period is for 95 years. The airport will be equipped to handle large aircraft – Boeing 737 and Airbus 320. MIDC will hand over 670 acres of land to IRB for the airport. The developer can also develop commercial facilities on surplus land, with MIDC acting as the special planning authority.

The land is already in MIDC’s possession, meaning no delays due to land acquisition and resettlement. The developer will have to obtain environmental clearances and arrange for finance. This will be IRB’s first airport project in the country. It was eligible to bid as MIDC had allowed core infrastructure developers to bid for the airport project too. Most of the airport operators in India are cutting their teeth on greenfield projects, taking the help of consultants and foreign airport operators. IRB is likely to do the same.

Sindhudurg is in the Konkan district and is very close to Goa. There are two main objectives for setting up this airport. One, Sindhudurg has a very attractive coastline, not very different from Goa. The Maharashtra government has been trying to develop the region as a key tourist destination, but tourism infrastructure in the region is minimal. While that makes it a pristine and beautiful destination; in comparison to Goa, it would be drawing few visitors and negligible revenues.

The second objective is to provide an alternative to Dabolim airport as an entry point to the region. The airport will be about 90kms away from the Dabolim Airport in Panjim. The government is hoping that once the airport develops, hotels too will flock to the region, to cater to the traffic that seeks an alternative to Goa. The airport is to come up in 18months, a very short period of time.

The company’s share price is up by 8% at Rs 198, on the BSE.

Additional Information: The pre-application presentation by MIDC

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