AAI, AIRPORTS News, Aviation Business, Expansion, Regional Connectivity, Upgradation

AAI to raise Rs 1,500 crore from debt market

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New Delhi: Prodded by the prime minister’s office (PMO), state-run Airports Authority of India (AAI) has decided to raise about Rs 1,500 crore from the debt market, leveraging its balance sheet in the current financial year. Major portion of this fund would go for upgrading Kolkata and Chennai Airports, which are facing capacity crunch in the wake of rising traffic.

Official sources said that AAI held an internal meeting on capital expenditure last month where the proposal was discussed. “The plan is to raise about Rs 1,500 crore, but depending on requirement it could be raised further,” an official said.

As the government has decided to expand airport capacity by more than five times to handle a billion trips a year, AAI needs to accelerate capacity expansion of existing airports and also build new ones in smaller towns and cities.

“Due to lack of infrastructure, some of the RCS (Regional Connectivity Scheme) flights have been affected. Also, there is capacity constraint at bigger airports. Therefore, there is need to build capacity at faster pace,” another official said.

Domestic air traffic has been growing exponentially in double digit for the last about 42 months, necessitating airport expansion. Severe capacity crunch at most of India’s major airports has already rung alarm bells among the airlines, threatening to delay their aircraft delivery schedule.

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