Thursday, December 24, 2009

The inside story : Defogging BIA's turbulence

The inside story : Defogging BIA's turbulence

E Raghavan



At best, it is yet another instance of flogging a dead issue. That precisely seems to be the outcome of the report of the joint house committee (JHC) of the Karnataka legislature which examined the construction of Bangalore International Airport.
Beyond stating the obvious that has been articulated, not once but a hundred times by interested parties, the report that seems to suggest a skew in favour of BIAL from the very beginning, does not fix responsibility.
If the JHC, for instance, was unhappy over the specifics in the concession agreement which was the basis for building a greenfield international airport, it could have pulled up the union government which drew up and signed the concession agreement. If the committee was sure that the state government had given more than what was necessary to BIAL, it could have at least tried to figure out who actually was responsible for that.
Instead, it merely provides a list of all officials and civilians appointed by the state to the board of BIAL and suggests appropriate action against them. The report is more or less a chronological story of BIAL with some general observations thrown in good measure and many suggestions that defy logic. It would like you to believe that the concession agreement was flawed and not necessarily in the interest of the state. It does not however say so directly but suggests that any proposed project in the public private participation (PPP) model should not let go of public (meaning either state or bureaucratic) supremacy.
This and other equally important issues such as the public demand for reopening HAL airport have been argued sufficiently, including in the courts of law. Some of those cases are still pending, thus rendering the views of JHC somewhat superfluous. Even if you do not go back in history why the search for an alternative to HAL started in the early eighties, the decision to shut HAL was taken formally in 1999 by the union government to develop another airport with private participation.
That and other provisions of the concession agreement have the stamp of the union government giving it the weight of a sovereign commitment. The government, of course, has a right to review its commitments but there are consequences; the foremost, as some industry leaders have said, being the credibility of the state itself.
Beyond this key issue, many other recommendations are pretty minor and routine in nature. Some, such as treating all state expenditure, including setting up power and water facilities and widening the national highway to carry additional traffic, as equity to force the private parties to pump in more equity is somewhat rhetorical.

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