KPMG, Ernst & Young vie to advise on India’s Taj airport

Twenty consultancy companies responded to a request for proposals to help develop a potential international airport in the Indian city of Agra.

The Uttar Pradesh state government has received twenty proposals for a consultancy mandate to help develop the new Taj Mahal International Airport, Manoj Kumar Singh, the director general of the Indian state’s tourism department, told Infrastructure Investor.

L&T-Ramboll, Ernst & Young, KPMG, Ineco, Prointec, Knight Frank, Darashaw, Aegis India and RITES are among the firms that have submitted proposals, Singh said.

The selection of the airport site is expected to be a challenge, as there are restrictions imposed by nearby airbases. A previous proposal to build the Taj International Airport was scrapped in May for being too close to the New Delhi airport. 

Another proposed international airport at Kushinagar, in the same state, received 32 expressions of interest in May this year. Kushinagar has been revived after companies interested in the project failed to submit bids for it in 2010. GMR, GVK, Larsen and Toubro and Gammon India had been shortlisted to bid for the airport in 2010.

The project has now been modified, with its indicative cost reduced from INR5.6 billion (€79 million; $103 million) to INR 2.5 billion. The state government has also removed the criteria under which only companies with experience in airport construction could apply.

Several infrastructure firms have shown interest in the project this year, including Gammon Infrastructure Projects, Enginera, Samsung, DS Construction, TATA Realty and Infrastructure, Cochin International Airport, Essar and WelsInfratech.

The Uttar Pradesh government is seeking 20 percent in Viability Gap Funding to help cover the INR2.5 billion projected cost of Kushinagar Airport.

Viability Gap Funding is a capital subsidy provided by the government to encourage the private sector to invest, develop and operate government infrastructure projects on a public-private partnership basis.

The Ministry of Economic Affairs is to decide on principal approval for the funding on September 25.