Friday, April 18, 2008

HAL will not stay open: Govt, BIAL

HAL will not stay open: Govt, BIAL
Thursday April 17 2008 13:58 IST

BANGALORE: Following the High Court directive on Wednesday asking Union and State governments and the Airports Authority of India to renegotiate the deal with the Bangalore International Airport Limited, the State Government and BIAL are together on the stand that the renegotiation will not result in HAL Airport remaining operational.

“It is not an interim order; it's just a direction for renegotiating the agreement,” said a BIAL official.

Principal Secretary, Department of Infrastructure, Karnataka, V P Baligar, said “We are yet to get the written copy of the direction and are not yet clear on which agreement is to be renegotiated.

If it is the Concession Agreement, the GoI will renegotiate and if there is any role for the StateGovernment, we will do the needful. The State Government becomes party to renegotiation only if the State Support Agreement has to be renegotiated.”

When asked on whether the GoI, GoK or any other party will have to pay any penalty to BIAL in case HAL Airport remains operational, Baligar reacted sharply: “Why do we have to talk about penalty? The renegotiation does not necessarily have to result in keeping the HAL Airport open. Moreover, I amtold that the directions by the HC were more to do with the UDF and not theclosure of HAL Airport.”

However, BIAL officials said: “This (the Court direction) will not affect BIAL's decision on UDF. BIAL is discussing the UDF issue with the Ministryof Civil Aviation and that decision will be final.”

HAL happy over direction

HAL officials expressed happiness and relief over the direction by the HC. A senior HAL official requesting anonymity said the renegotiation was needed and is justified as many projections and estimates on which the agreement is based have already changed.

Moreover, keeping HAL Airport open will not cause any financial loss to BIAL as Bangalore air traffic has grown so much that it can generate profits for both the airports, he said.

Also, BIA alone cannot handle the traffic for long and will saturate its capacity in the first year of operation, he added.

Government bound by agreement signed in 2004

According to the Article 5 of the Concession Agreement between Ministry of Civil Aviation, Government of India and Bangalore International Airport Limited signed on July 5, 2004, Government of India has the obligation of maintaining the exclusivity (section 5.2) of BIAL in international and domestic aviation operations by not allowing any new or existing airports within an aerial distance of 150 kilometres of the Airport before the 25th anniversary of the Airport Opening Date.


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