NEW DELHI: In a bid to reduce operational overhead costs in developing airports and related infrastructure projects by one-third, the Airports Authority of India (AAI) will chip in using its in-house manpower and expertise instead of subcontracting work to outside agencies. Senior AAI official said the plan would come into effect from April this year with the start of the new financial year.
The AAI is expected to disburse close to Rs 3,500 crore against work contracts to private developers by March 31, the end of the current financial year. The government has allocated Rs 17,500 to AAI for developing airport’s infrastructure for the next five years. AAI is aiming to save around Rs 3,500 crore by utilising its manpower rather subletting work to private contractors.
The move also comes in at a time when the government is eyeing big on connecting airports in remote areas within the country under the Regional Connectivity Scheme (RCS) project. The project aims at connecting remote un-served and under-served regions of the country through revival of existing air-strips and airports.
In the first phase, the government plans to make 60 airports—10 owned by AAI and 50 by state governments—operational over the next three years.
This is where the AAI will explore larger role of its own manpower to develop these airports, sources said. AAI has got a budgetary support of Rs 2,543, which includes Rs 2,443 crore as capital infusion in the new budget for 2017-18. AAI has received encouraging response to its RCS, where 45 proposals from 11 bidders covering over 200 RCS air routes have come in. According to AAI, these initial proposals cover as many as 65 airports, of which there are 52 un-served and 13 under-served airports as per the provisions of the scheme.
Earlier, FICCI said that there are 44 potential airports that could be developed under the RCS policy. The government had said that it would be evaluating it through an independent mechanism to ensure the success of RCS project.
The AAI has reported 16.58 per cent increase in revenue for the financial year 2015-16 to Rs 10,824.50 crore from the year ago period. AAI has a planned fund of Rs 2,000 crore this financial year and Rs 2,500 crore for the 2017-18 period. India, at present, has 76 functional airports and the government aims to add 50 more under the RCS project, that is yet to take-off, as airlines are not finding the project viable. They are not sure of the air travel demand for these destinations.