Monday, September 10, 2012


Prosecute GMR and its cohorts

The recently published `CAG’ report confirmed, despite that the government claims of transparency, it had pushed to the wall with no ammunition to defend itself. It is an irony, that reeling under the impact of several scams the dispensation leading by Dr. Manmohan Singh is vitiated the sanctity of the highest office in our country.  The role of the `PMO’ in the coal block allocation is became the `mother of all scams’.

It is equally important that the infrastructure development projects muted through public private partnership (PPP) mode is also mired in similar controversy. There is no level playing field and transparency either in these agreements or the execution of these projects. The malpractices carried out by the private developer- the GMR owned DIAL – in the name of developing the Delhi airport has also the blessing of our Prime Minister with his passive attitude. The `PMO’, the Civil Aviation Ministry, and the Delhi International Air Port Ltd. (DIAL) have actively colluded with the developer (GMR) to amass an amazing quantum of wealth through numerable conspiracies.

The Controller and Auditor General has criticized development fee charged on passengers at the Indira Gandhi International Airport. Allowing development fee of Rs 200 for domestic and Rs 1300 for international passenger gave `GMR’ an undue monetary benefit of Rs 3,415 crore. This levy has violated the bid conditions and it shows certain recklessness to follow the original contract.

Whenever the operator has raised an issue of extra revenue, to go to it or expenditure to be debited to government, the Ministry and Airport Authority of India had always ruled in favour of the GMR Corporation, and against the government interest, in contravention of the Operation, Maintenance, and Development Agreement (OMDA).  The Report further says that, DIAL has the potential to earn Rs 1,63,557 crore over a 60 year period of time. The 2,799 acres of land leased out to GMR at Rs 100 a year has just stood out an equity investment of Rs 2,450 crore. Five percent of this land or 239.5 acres, allowed for commercial use, has current value of Rs 24,000 crore. This too was given to GMR as part of 4799 acres for lease of Rs 100 per annum.

The `CAG’ points out that the joint venture company, shall meet all its financial requirements through suitable debt and equity contributions to comply with its obligations, including the development of the airport. The Ministry’s order on February 9, 2009, to allowing the GMR to levy a development fee for financing the upgrade, expansion or development of the airport is sheer violation of the original agreement. This order violated the provisions of Article 13.1 of the OMDA, the AAI Act and the Airport Economic Regulatory Authority (AERA) Act, later confirmed by the Delhi High Court.

The levy of development fee was a post contractual benefit given to the `GMR’, to bridging the funding gap was neither envisaged in the request for the proposal (RFP) nor included in the provisions of OMDA or the state support agreement. This led to an undue benefit of Rs 3,415 crore to the DIAL at the cost of passengers.

Another  hilarious fact is that, beyond all these government largesse’s Delhi Airport is remaining with the most expensive and prohibitive airports in the world. The Airport charges are now increasing to a level of 334 % for domestic carriers in one year, is magically higher to 700 per cent. High airport charges are a serious problem that will ultimately increase the passenger’s burden. The thing is that, the spiraling charges in Delhi Airport had been most critical, and a result of these more foreign airlines is postponing increasing their capacity in India. Another funny thing is that in Delhi Airport the airlines are not only paying for departing flights but also for arrivals. There is no airport in the world that does this practice.

All these points raised by the CAG, and other facts are pointing the loot carried out by the GMR Corporation. The PMO and the Civil Aviation Ministry are equally responsible for this daylight looting. There is an urgent need to revisit the way PPP projects were allotted in the country.

The aviation industry in our country has suffered, a lot from the callous attitude of former Aviation Minister Mr. Praful Patel. The cumbersome ideas carried out on the merger of Air India and Indian Airlines have paved the way for the disastrous performance of our national carrier. These puerile changes have gone to shepherding the carrier to the mean streets of economic peril, and faces uncertain times ahead. The cancellation of profitable routs for the benefit of private carriers has reaped immense gains for the civil aviation authorities, and the minister himself. The very happening in this industry need an urgent course correction with thorough professionalism.

The Congress Secular Hindu Forum has demanding the government of India, to strike a note of realism, and must be take all steps immediately to take back the money illegally collected by the GMR, and recover the huge wealth handed over the DIAL through illegal methods. To stop the ongoing collection of user development fee with immediate effect and prosecute the persons responsible for the loss to the exchequer through a thorough probe by the CBI.

K. Ravi Kumar,
General Secretary – Central Committee