Friday, April 18, 2008

BIAL may move SC against renegotiation order

BIAL may move SC against renegotiation order
Saurabh Sinha & Anshul Dhamija | TNN

New Delhi/Bangalore: The high-voltage drama on whether or not Bangalore should have two airports may now move to the apex court.
After the Karnataka High Court placed its recommendations on Wednesday suggesting that the government renegotiate the concessional agreement with Bangalore International Airport Ltd (BIAL), keeping public interest in mind, the matter is now believed to be heading to New Delhi where a final decision could emerge.
According to sources, BIAL has taken stock of the HC’s suggestions and in all probability will move the Supreme Court seeking a stay on renegotiation.
BIAL is expected to argue that the agreement signed between the government and them is a binding legal contract and cannot be relooked into at such a late stage.
BIAL has invested Rs 2,500 crore in building the airport with an additional investment of Rs 1,000 crore by concessionaires. BIAL CEO Albert Brunner had in the past said that any renegotiation by the government on the concessions agreement would be regarded as a black mark and would dissuade investors from entering into public-private partnerships.
When TOI contacted BIAL on the matter, the airport’s spokesperson said, “We have not received the court order. Since the matter is still in court we cannot comment.”
During most part of Thursday, BIAL is said to have been holding high-level meetings on the court order. Senior civil aviation ministry officials too declined to comment saying that the court orders are awaited.
But sources said the government will look to leverage the HC’s suggestions and hold discussions with BIAL on user development fee and on keeping HAL Airport open. “The government has been wanting to have a relook at the concessions agreement, but has not got an opportunity. Now it can use the HC’s suggestions and force BIAL to take a second look,” a source said.
The user development fee (UDF) is also expected to come up for negotiation. TOI had earlier reported that the civil aviation ministry had suggested to BIAL to keep the UDF for shorthaul routes (a flight time between 30 minutes to an hour) at Rs 100 and for long haul flights at Rs 200. BIAL had proposed a UDF of Rs 675 on each domestic passenger


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