Published On:March 14 2018
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Bhogapuram airport: New request for proposal likely by month-end.

The new RFP (request for proposal) is being readied to be floated by the month-end for the development of the Bhogapuram greenfield airport in Andhra Pradesh.

“This time, the RFP covers not just the development of the airport but also related infrastructure, making it an integrated airport project. They include an aviation academy, MRO (Maintenance, Repair and Overhaul) facility for aircraft, and aerotropolis,” Ajay Jain, Principal Secretary, Energy, Industries and Infrastructure, said.

“The State government is keen to develop an integrated airport so that a larger ecosystem gets created for the growth of the aviation sector in the State. This is one of the reasons that the earlier proposal to award it to Airports Authority of India was cancelled so that new RFPs could be floated,” he told BusinessLine .

In addition to about 2,500 acres earmarked for the project, another 200 acres were added to meet the requirements of the upcoming RFP, which is under finalisation and likely to be released by the month-end, he said.

In the earlier RFP, the AAI had pipped GMR by bagging the mandate to develop the airport. In the financial bids opened in August 2017, AAI had offered a revenue share of 30.2 per cent against GMR’s 21.6 per cent.

After the Empowered Group of Secretaries presented the details of the financial bids and offers by AAI and GMR, the State government decided to invite fresh RFP for the project, making it an integrated airport.

Earlier, GVK Power & Infra and Essel group participated in the initial stages of pre-bid meetings. However, only AAI and GMR submitted bids.

The project proposed at Bhogapuram, about 40 km from the port city of Visakhapatnam, where a naval airport is currently operational, had an investment outlay of Rs. 2,261 crore, to be taken up under the public-private partnership mode.

SPV formed

The government has formed a special purpose vehicle, Bhogapuram International Airport Company Ltd. The airstrip will have capacity to facilitate large-bodied aircraft such as Airbus A 380.

While the expansion of the project scope to make it an integrated airport augurs well for the development of infrastructure, the move to cancel the bid of AAI, and finalise a new one through fresh RFPs and then finalise a developer based on their financial bids, could delay the project works by a minimum of six to 12 months.

HBL


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