Gautam Adani
Gautam AdaniTwitter [Representational Image]

The union cabinet headed by Prime Minister Narendra Modi has approved the privatisation of the airports at Mangaluru, Lucknow and Ahmedabad by leasing it to Adani Enterprises Ltd.

The Adani group, which was the highest bidder, has leased out the airports for 50 years, during which it will manage, operate and develop the facilities and infrastructure of the airports under the public-private-partnership (PPP) model.

Adani Enterprises quoted per passenger fee of Rs 174 for the Jaipur airport, Rs 177 for Ahmedabad and Rs 115 for Mangaluru, in respect of each passenger handled at the airport.

In a bidding process that took place on February 2019, Adani had won the tender for six airports -  Thiruvananthapuram, Mangaluru, Lucknow, Ahmedabad, Guwahati and Jaipur. The airports are currently operated by the Airports Authority of India (AAI).

Several other players like GMR, NIIF, Cochin International Airport, and AMP Capital also participated in the two-stage tender process.

The government will make the final decision over the lease of Thiruvananthapuram, Jaipur and Guwahati by the end of July.

The Kerala government had raised concerns about handing over Thiruvananthapuram airport to the Adani group. The government stated that it will be impossible for any private firm to develop the airport without support from the state government.

The chief minister of Kerala, Pinarayi Vijayan, had moved the Kerala High Court on March 2019 against Adani's lease tender. He also wrote to Prime Minister Modi, questioning Adani's bid. He asked how a private bidder with no experience in the operations of the aviation field won the contract.

Vijayan also alleged that the tender was released in favour of the Adani group and that the PM had a role in it.