Examine the development of Airports in India through joint ventures under Public-Private Partnerships (PPP) Model. What are the challenges faced by the authorities in this regard?

A public-private partnership (PPP) model is an understanding or agreement between two or more public and private sectors. It may be called a semi privatization arrangement. It is considered as a highly efficient system of management with more transparency.

PPP and airports

  • PPP model helps to develop the infrastructure of the airport for better operation.
  • It ensures security and ample facilities for passengers and for cargo delivery.
  • When airports are facing huge losses due to a shortage of government funding, the PPP model could restructure the overall system for smooth functioning.

History

  • In 1999, Cochin International Airport was developed as the first airport in India under the public-private partnership (PPP) model.
  • In 2004, Bangalore and Hyderabad airports were also considered under the PPP model.
  • In 2006, the government tried to modernize New Delhi and Mumbai international airports.
  • In recent times, Adani enterprise took the leasing of six airports i.e. Ahmedabad, Mangaluru, Lucknow, Jaipur, Guwahati, and Thiruvananthapuram. Though Kerala opposed the move.

Challenges

  • Private companies always look forward to acquiring more profit with a limited number of employees, which results in job loss.
  • It creates a problem in terms of tariff fixation, no provision for re-negotiation.
  • It increases the operation cost and hikes the fare.

Comment

Despite being so many problems the Public-Private Partnership model is showing significant progress in the UDAN scheme. The understanding between public and private players should not be rigid. Rather it should be more flexible to overcome all problems that are currently being faced by this sector.

Question for UPSC Mains:
Examine the development of Airports in India through joint ventures under Public-Private Partnerships (PPP) Model. What are the challenges faced by the authorities in this regard? (Answer in 150 words)

Published: October 31, 2017 | Modified:September 11, 2020

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