Reportlinker Adds Airport Infrastructure Financing

PR Newswire

NEW YORK, June 6, 2011

NEW YORK, June 6, 2011 /PRNewswire/ -- Reportlinker.com announces that a new market research report is available in its catalogue:

Airport Infrastructure Financing

http://www.reportlinker.com/p0546848/Airport-Infrastructure-Financing.html?utm_source=prnewswire&utm_medium=pr&utm_campaign=Airport

The need for airport infrastructure in India has increased considerably. An investment of more than Rs 35,000 crores is expected to be made in the sector from 2008 to 2012. In order to ramp up airport infrastructure, the Ministry of Civil Aviation has unveiled reforms to facilitate investment in this segment. Liberalization initiatives and the entry of low-cost carriers (LCCs) are expected to provide the market with a shot of adrenalin. The Airport Authority of India (AAI) was formed in 1995 to accelerate integrated development, expand and modernize the passenger terminal, air traffic services, and operation areas. The AAI Act was amended in 2004 to enable private participation.

In 2006; 100 percent FDI was permitted into Greenfield airports and the development of the new airports by the private participants was allowed," notes the analyst of this research service. "It is expected that the entry of private participants will infuse the capital necessary to enhance infrastructure and streamline airport management." Establishment of Airport Economic Regulatory Authority (AERA) as regulator will ensure sustained growth in the sector.

Airport infrastructure is witnessing improvisation and expansion on a massive scale, with the Government avidly supporting private participants. Trends indicate that the long-term prospects for both the private participants and the country are attractive. "The investment in Indian airport infrastructure market, especially in the Greenfield projects, will almost increase two fold in the next five years," notes the analyst of this research service. "The planned investment in airport infrastructure is estimated to be $9 billion by 2013."

During the past five years, the rates of growth for air traffic has been 18 percent, domestic cargo growth has been 16 percent, international cargo growth has been 12 percent, and passenger movement has been 20 percent, which bodes well for the market. Although the current aviation market is slightly tardy, some positive growth trends are expected in five to seven years. The growth trend for international aircraft movement is expected to be 13 percent and domestic has been pegged at 14 percent. The domestic passenger growth is likely to be 20 percent, and international, 16 percent. The cargo growth is expected to be at 12 percent and 10 percent for domestic and international respectively.

The Government of India has encouraged private participants by providing assistance in terms of tax holidays and offering land for construction. Empowered committees and steering boards have been set up to expedite and monitor the progression of projects and policies connected with the development of airport infrastructure. Observation of air traffic, cargo movement, and passenger movement across the main airports in the country suggests that the development of alternative airports will help ease congestion at the existing airports, and increase connectivity.

Funding can be purely public or public-private; however, Greenfield projects have remained public-private alliances. "The total investment toward airport development during the next five years is likely to be $9 billion, of which close to $6.8 billion is expected.

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