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Changi Airports International enters the Indian aviation market

Changi Airports International (CAI) has decided to enter into a strategic alliance with the Tata Group of India to pursue airport projects in the Indian sub-continent. Both sides have signed a memorandum of understanding to…

Changi Airports International (CAI) has decided to enter into a strategic alliance with the Tata Group of India to pursue airport projects in the Indian sub-continent. Both sides have signed a memorandum of understanding to invest in, develop and manage Indian airports. Pursuant to the memorandum of understanding, a joint venture company will be set up in which TATA will hold a 51% stake and CAI the remaining 49%.

The joint venture company will be bidding for the investments and operations of Chennai Airport and Kolkata airport under the on-going Indian Government’s airports privatization program which started two years ago. The existing airport in Chennai has a passenger traffic of 6.77 million passengers per annum (2006) and is currently the 3rd busiest airport in India while the Kolkata airport has a traffic of 4.4 million and is the 5th busiest airport in the country. Privatization programs for both airports are expected to be formally announced some time later this year. The scope of the joint venture will also extend to investments in other airports including regional airports as well as airports which have already been privatized.

On the aviation market in India, Mr Chow Kok Fong, Chief Executive Officer of Changi Airports International said, “At present, the air travel intensity per capita in India corresponds to 0.5% that of Singapore’s and the West. India, on the whole, is likely to see sustained economic development approaching double digits, a proof that the momentum for growth is truly awesome.”

On the choice of the Tata Group as the strategic partner, Mr Chow said “When we decided that we wanted to make a serious bid for these projects, it is clear to us that we need a partner with an organizational culture and business values to which we can easily relate. Tata fulfills all these. Their reputation within India and on the international stage is unrivalled.”

CAI has prepared carefully for the latest entry into India. In March 2006, it took on the task of implementing a 100 day Improvement Program for the Mumbai International Airport. That airport was secured by a consortium which included GVK of India and the Airport Consortium of South Africa. In addition, it also undertook on behalf of the same consortium a review of the master plan which had been prepared for that airport by the Netherlands airport group, NACO. CAI has also been involved in reviewing the airport scene across India.

Mr Chow remarked: “All these activities afford us to build a platform on the basis of which we can now formulate the kind of value propositions for the up and coming airports under the privatization program.”

Vicky Karantzavelou
Co-Founder & Chief Editor - TravelDailyNews Media Network | + Articles

Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales. She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.

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