The Hindu : Chennai: Gateway to S.E. Asia

Online edition of India's National Newspaper
Sunday, Jan 12, 2003

Opinion

Opinion - News Analysis

Chennai: Gateway to S.E. Asia

Although New Delhi and Mumbai are more attractive for investors, Chennai may be the natural choice for Malaysia given its strategic location and the frequency of flights.

THE PROXIMITY of Chennai to South-East Asia, the need for augmenting the presence of Malaysian Airlines and ideal ethnic links made Malaysia show keen interest in taking control of the city's airport. And, a four-member team of officials visited the Chennai airport in May last year on the direction of the Malaysian Transport Minister, Ling Liong Sik, to assess the infrastructure.

Now for the brakes. The recent Central Government announcement deferring the proposal to privatise the four metro airports and referring the issue back to the Union Finance and Civil Aviation Ministries, asking them to come up with the `quickest route' of a joint venture with the Airports Authority of India (AAI) or through government funding, has sent confusing signals to overseas investors.

Although the New Delhi or Mumbai airports could be more attractive for prospective investors, Chennai may be the natural choice for Malaysia given its strategic location and the frequency of flights. Also, the city is just three hours and fifty minutes flying time from Kuala Lumpur. The airport handled 4.1 million passengers at its domestic and international terminals in 2000, has registered a sizeable growth and is viewed as a "hub" poised to grow further. While the Anna International Terminal (AIT) handled 1.9 million passengers and the Kamaraj Domestic Terminal recorded 2.2 million passengers, domestic traffic registered a 20 per cent increase and international traffic showed a five per cent growth.

But there are glitches too. The city lacks a world class airport. The proposal for a joint venture airport with the AAI, mooted by the Tamil Nadu Industrial Development Corporation (TIDCO), is on hold with the Centre initiating the privatisation move. Aviation experts say that even under the restrictive aviation policy, a limited increase in air traffic to Chennai would boost the cargo carrying capacity out of the city, giving a fillip to economic activity in the region as a whole.

The Malaysian delegation enquired about the workforce of the airport, its revenue and expenditure and went round the Rs. 80-crore `Departure Module' — set to provide an extended terminal area of 24,560 sq m — now under construction by the AAI's international airports division. This will be ready by March this year.

Thus, the postponement of the privatisation proposal has come as a rude shock to the Malaysian investor. "We have not heard from the Indian Government after our on-the-spot inspection of the Chennai airport facilities and the regrettable part of the entire exercise is that the Government has still not made it clear which route — whether leasing, or joint venture or Government funding — would be adopted for taking forward the proposal," laments a source who coordinated the visit of the Malaysian delegation.

Meanwhile, the president of the Air Passengers Association of India (APAI), D. Sudhakara Reddy, has charged the Civil Aviation Ministry with failing to lay down a clear, investor-friendly policy in the civil aviation sector. — T.S.S

Printer friendly page
Send this article to Friends by E-Mail

Opinion

Stories in this Section

Grounded... for now

Chennai: Gateway to S.E. Asia

High on hope