The Telegraph
Sunday , December 2 , 2012
Since 1st March, 1999
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Changi terms to up aerotropolis stake

Calcutta, Dec. 1: Singapore-based Changi Airports may hike its investment in the upcoming airport city project in Bengal if the Mamata Banerjee government clears the roadblocks.

The foreign firm has already informed the state government about its willingness to become the leading developer of the urban infrastructure project at Andal, Burdwan.

“I have met Changi officials on the first day of the fair. They have indicated that they are increasing their investment from 26 per cent to about 51 per cent,” state urban development minister Firhad Hakim said on the sidelines of Bengal Builds, a conclave on urban infrastructure development, that concluded today.

Changi is the strategic partner in Bengal Aerotropolis Projects Ltd (BAPL), a company promoted by four city-based businessmen to build an airport and a city around it with a light engineering unit, an IT hub, social infrastructure and a township.

The West Bengal Industrial Development Corporation (WBIDC), the nodal agency of the Bengal government for industrial development, has given 1,818 acres for the project.

Sources said Changi CEO Lim Liang Song had met industry minister Partha Chatterjee on October 17 in Calcutta and had agreed to raise the stake. The Mamata Banerjee government wants Changi to be the leading partner in BAPL to add more credibility to the project.

Several attempts to contact Changi for confirmation of the report failed.

Changi now holds a 26 per cent stake and, if it makes further investment, it could become a majority stakeholder.

Infrastructure Leasing & Financial Services Ltd and WBIDC hold 12.65 per cent and 1.2 per cent, respectively, in BAPL.

The promoters, who own the remaining 60.15 per cent, will have to dilute their stakes following the restructuring.

The Andal project is running behind schedule and will miss the deadline of December 31, 2012, to make the airport operational even as the company claims it will complete construction by then and apply for the DGCA’s clearance.

“Bengal Aerotropolis is saying the first flight will take off from the airport from Poila Boishakh. They have said they want to do the job quickly. Our government is with those who want to do work quickly. Whatever help ADDA (Asansol Durgapur Development Authority) can offer will be provided,” Hakim said.

According to a senior BAPL official, Changi has agreed to increase its stake on the condition that the state government expedite the provision of certain facilities.

BAPL needs state help to relocate some high-tension electric towers obstructing the flight path by acquiring land. Moreover, ADDA has to divert a village road.

Changi also wanted WBIDC to drop some of the changes being proposed in the development agreement with BAPL. The state wanted a 10 per cent commission on any subsequent transfer of land in the township area. This will include transfer of property between two individuals who may buy the plot. BAPL felt this clause would harm the prospect of the project.

If Changi becomes the lead developer, more Singapore companies are likely to consider investing in the project.

“Of all the consortium members, only Changi is an airport operator. To make the airport a success, the state government wants Changi to play a bigger role,” the official said.

The official also said talks were on with airlines such as Jet Airways and Air India to schedule flights from the airport.