Airports to drive local economic development: Gautam Adani

With the addition of the Chhatrapati Shivaji Maharaj International Airport (CSMIA), in Mumbai and the upcoming airport in Navi Mumbai to the Ahmedabad-based Adani Group’s portfolio, company chairman Gautam Adani said he views airports “as a powerful engine to drive local economic development”. The Adani Group is the largest port operator in India as well as a thermal coal producer.

In a statement issued on Wednesday afternoon, two days after making public his company’s business interests in CSMIA, Adani said that airports, “act as a critical lever to help converge the tier 1 cities with the tier 2 and tier 3 cities in a hub-and-spoke model”.

This hub-and-spoke model, he elaborated, “is fundamental to enable a greater equalisation of our increasing urban–rural divide as well as take advantage of the cost arbitrage that exists between the different locations to make us more competitive as a nation”. This, he said, is critical for the creation of “net new jobs”. “Given our deep infrastructure expertise, we are well positioned to help make this happen.”

On August 31, Adani Airport Holdings Limited (AAHL)—the Adani Group’s airports business entity—had entered into an agreement to acquire the debt of GVK Airport Developers Limited, which holds 50.5% equity stake in Mumbai International Airport Limited that owns and operates CISMA. MIAL in turn holds 74% equity stake in Navi Mumbai International Airport Limited.

“Upon the acquisition of the debt of GVK ADL, Adani Group will take steps to obtain regulatory approvals, as may be required, to acquire controlling interest in MIAL,” read a release by the Adani Group.

Through a privatisation drive conducted by the Airports Authority of India, AAHL had won the mandate to modernise and operate the six government-run airports of Ahmedabad, Lucknow, Mangaluru, Jaipur, Guwahati, and Thiruvananthapuram, for a period of 50 years. According to AAHL, it has signed the concession agreement for the Sardar Vallabhbhai Patel International Airport (Ahmedabad), Chaudhary Charan Singh International Airport (Lucknow), and Mangaluru International Airport (Mangaluru). However, the Left Front government in Kerala is opposing AAHL’s takeover of the airport in Thiruvananthapuram.

“The addition of the Mumbai International Airport and the Navi Mumbai International Airport to our existing portfolio of six airports provides us a transformational platform that will help shape and create strategic adjacencies for our other B2B businesses,” said Adani.

Interestingly, Wednesday marked the 100th day since the resumption of domestic commercial passenger flight operations in the country. CSMIA catered to a total of over 835,000 passengers and handled a total of 7,981 domestic flights for the period from May 25 to September 1. The airport saw the highest passenger load capacity on the Mumbai–Delhi route with 152,000 passengers, followed closely by Varanasi with 79,391, Patna with 60,116 and Kolkata with 37,385 passengers, respectively.