Centre Plans ₹8,622 Crore Private Investment Across 11 Airports Under 50-Year PPP Model

The Centre is preparing a new private investment push in India’s airport infrastructure, with 11 Airports Authority of India (AAI)-run airports proposed to be offered to private operators under 50-year public-private partnership (PPP) concessions.

The plan is expected to attract an estimated ₹8,622 crore in private investment for the development and operation of the airports. The Public Private Partnership Appraisal Committee (PPPAC) gave in-principle approval to the proposal at its meeting on 4 August, according to official documents reviewed by media organisations.

Rather than offering the airports individually, the government plans to group them into five bundles. Each bundle will combine a larger airport with one or more smaller airports, allowing stronger passenger traffic and commercial potential at major airports to support the development of smaller regional facilities.

The five proposed bundles are Amritsar with Kangra-Gaggal, Varanasi with Gaya and Kushinagar, Bhubaneswar with Hubballi, Raipur with Aurangabad, and Tiruchirappalli with Tirupati. Each bundle is expected to be awarded to a single private concessionaire.

The bundling strategy is designed to improve the commercial viability of airports with different traffic levels. The government selected the airports through a phased assessment carried out by AAI. Twelve major airports were initially examined using factors including passenger traffic, land availability, commercial potential and financial performance. AAI then assessed 136 smaller airports for possible combinations based on traffic potential, capital expenditure requirements, geographical proximity, city-side development opportunities and financial viability.

The proposed concessions will run for 50 years. Private operators will be responsible for investing in the airports in accordance with the requirements approved by AAI, with further capacity expansion linked to traffic and capacity thresholds. The government expects the model to bring additional capital into airport development while improving operational efficiency and infrastructure at the selected facilities.

The proposal also contains measures aimed at preventing excessive concentration among private airport operators. The number of bundles that can be awarded to a single bidder is proposed to be capped. The government says this is intended to reduce risks associated with market concentration and excessive leverage across multiple airport projects.

Employee transition is another part of the proposed structure. The Civil Aviation Ministry has proposed a one-year joint management period involving existing AAI employees after the airports are handed over. Private concessionaires would subsequently be required to retain 60 per cent of AAI employees for up to three years. The arrangement is intended to support continuity during the transition from public to private management.

The latest proposal also opens the door to a wider pool of infrastructure companies. Companies with relevant experience in infrastructure sectors beyond aviation may be considered, subject to the final bidding conditions. This could potentially bring companies with experience in roads, ports, power and other infrastructure segments into the airport development process.

The proposed airport PPP programme comes after the government’s earlier round in 2018-19, when six AAI airports were awarded to private operators. The new plan represents another significant step towards increasing private participation in India’s aviation infrastructure while using larger airports to support smaller regional facilities.

If implemented, the ₹8,622 crore investment programme could give the selected airports additional capacity, commercial development and operational upgrades, while extending the role of private capital in India’s rapidly expanding aviation infrastructure network.