Monday, May 19, 2008

Industry biggies bat for HAL airport, rap govt

Industry biggies bat for HAL airport, rap govt

BS Reporter / Bangalore May 18, 2008, 4:31 IST

Bangalore's information and biotechnology majors have again trained their guns at the government over the closure of the existing HAL airport.

Two days after the civil aviation ministry issued a notification directing the closure of the HAL airport from May 23 and the subsequent launch of the Bangalore International Airport (BIAL) at Devanahalli, industry players put up a collective fight on Friday under the Bangalore City Connect Foundation (BCCF) (a non-profit organisation) banner that seeks to unite urban stakeholders outside the government to demand continuation of the old airport.

The BCCF members slammed both the Centre and the state government for failing to renegotiate with (BIAL) on keeping the HAL airport open despite a suggestion from the Karnataka High Court.

BCCF had questioned the Concession Agreement signed between the government (which has 26 per equity) and private promoters (74 per cent) in July 2004, according to which the HAL airport was to be closed once BIAL commences operations.

BCCF had cited capacity constraints at BIA and demanded continuation of the HAL airport as air traffic has witnessed an explosive growth than projected. But with the BIAL refusing to budge, BCCF members have decided to launch a demonstration at the HAL airport on Saturday to protest against the governments' failure to convince BIAL.

Addressing a press conference, Biocon Chairman Kiran Mazumdar Shaw said the closure of the HAL airport is detrimental to competitive business edge and is not in the interest of public good.

"Bangalore's growth momentum can be ensured only by allowing both the airports to flourish. With the government not renegotiating with BIAL, we are heading towards a crisis," she said. Terming the contract (concession agreement) a fraud, she said it would send the wrong signals if amendments were not made.

"The passenger growth projections, on the basis of which the agreement was signed a few years ago, was relevant at that point of time. Now, the circumstances have changed and the city, which is on a high growth trajectory, should be allowed to operate two airports. So there is a case to renegotiate now," she added.

When asked how she would react if her company or another corporate body were to be forced to change any agreement because of external pressure, she said: "Any agreement is relevant for a given period. It can be renegotiated on the basis of a new set of circumstances."

"BIAL has asked for monopoly status and the people cannot be held hostage to such an agreement," she said, adding that a developing country like India cannot afford to close down an existing infrastructure when it is facing infrastructure-related problems.

Joining her, Infosys Technologies Vice-President (human resources) T A Mohandas Pai said the closure of HAL airport would damage Brand Bangalore further.

"The IT industry is already upset with traffic congestion, this would worsen it further. Almost 30 per cent of people from the IT industry in Bangalore travel outside India at least once a quarter. If they spend one or two hours just commuting to the airport, it will hamper the industry," he said.

The IT industry in Bangalore is currently growing at 30 per cent per annum. "If 35,000 vehicles hit the Bellary Road, which leads to BIAL, imagine what kind of delays it would cause," Pai said.

Concurring with him, Sudip Bannerjee, former president of enterprise solutions, Wipro Technologies and director of PremjiIinvests, said: "We have already started getting requests from our IT clients seeking meetings in Chennai and other places".

Though the civil aviation ministry said that it has held two rounds of talks on the concession agreement and that BIAL has refused to allow HAL airport to function, BCCF members alleged that the government was not effective enough in pushing its case.


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