! I URGENT OUT TODAY AV-20036/414/2015-AAI-MoCA Government of Ministry of Civil Aviation *** ** '8' Block, , , New Dated, the 02nd March, 2017 To Chairman, AERA, Safdarjung Airport, .

Subject: Request for inclusion of land cost as a part of RAB in the matter of determination of aeronautical tariffs in respect of CHIAL for the first control period (01.04.2016-31.03.2021).

Sir,

I am directed to forward herewith copies of D.O. letter NO .PS/PSCAl2017/296 dated 28.02.2017 and PS/ACS(CA)/2017/181-L dated 28.02.2017 as received from the State Governments of and Punjab respectively on the subject mentioned above and to say that both the State Governments have requested to consider land cost as part of RAB and an aeronautical asset for ARR termination of aeronautical tariffs in ·respect of C AL for the first control period.

2. Both the State Governments have 24.5% equity stake each in the Joint Venture in the form of land and the cost of land has been equally shared between both the State Governments. Since equity is considered as part of RAB, the requests of both the State Governments are for consideration of AERA.

3. AERA is requested to take further necessary action in the matter.

Yours faithfully

~ (P J Thomas) Under Secretary to the Government of India 'Z3r24610361 Enel: As above 1\& ,

~ .--- . \ t · {"..X;Y/ . DI'i/ .~.~ .'. , !] !J...JY- ~ I D.O. No. R$.j.eS'''l.j.;\ . "I fT ,. . al Secn~..'.· t "'""':f"r'Uto.._ jG0 vt, HillVICma '"';'­ Dr. Mafhl'lo'ir SJn1.~h. P•.~· o.~ Q .PrtllClp.. I·L AVl. a.:t.'c::rn Dapa'l. . rtment. M C\VkHsntr Education...... ".. -r+­ Chafidigarh ~(\ [)att?d ?~t ed: 28.02.2017 ~ -oJ", } • , ~ ...... " ,. • .~ ~ • ~ ," • • .-. ~ . .. ~ ~ , ,,,-,, ,, --, ~ ~ " II ,, " I ' . '" .. ... c0 Subject ~n~inclusiQn of land cost as a part ofRAB- In the matter of f'S) Determination of Aeronautical Tarl~ in respect of CHtAL for the first Control Perl.Qd JOU)4;2016 - 31..03.~021)byAERA • ...... I'\' ~ Y .~ /) AYU 1, Tnls ts with reference to File No. AERAI 20010iMYTPJ CHIAU CP ··1I1 2018­ 17. Consultatton Piaper No,3IZ01l>-17 dated 14,02,2017. I may brlrjg It 10 your notice that Chandigarh Jntemaliom:il Airport Limited (CHIAL) is a joint venture company incorporated under Companies Act, 1956 by AllthoTily of India (a Go\terhnient of lndia Enterprise) having 51% Equily Slake. in association with Punjab Government through Greater Mohali Area Development AuthQrity (GMAOA/ having 24;5% Equity Slake and Haryana

Government through H~ryana Urban Development Authority (HUDA) havingU.5% Equity Stake to operate ano ma intain Chaocligarh lnternsfional Airport.

The cost of Land has baen 'equally shared between tbe Government of F>unjab ano Haryana whlel, nas be~ncap ilalized in thS' boqks 01 CHIAL and has been counted towards the eqUiiy contributlon of GMADA and HVDA. Thus, the cost of Land is the pari of Project Cost.

This is 10 submit that land is a costly and rare resource which is essential to propagate construction of such new Greenfield Airports. If the cost of land is not taken tor RAB purposes than this model will (ail and no Slate Govt, iri future will be willing to pari with the land resulting into scarcity 01 lnfrastructure for cMlaviation. It is therefore, requested that Ministry should pursue our submission ' to consider the ' land cost as a part of RAB and aeronauncatasset for ARR determination wlllch will help in making this project viable. (;J/ti... 6~ t"J1~. YOU~Sf Ithfully ) Jt Jit'.-­ (Or. Mah i' Slngh). lAS

sn, Arun Kumar, lAs Joiht SecretalyMlnlstry of Civit Aviatfon Government of India . Rajiv Gandhi 8hawan Safdar/ung Airport. New Dellli·, to 003 e-f)~ ~ /V' ~ 1\rt\J~ U~_)) ~~<) ~ .~ j~/~'V ~ ~'J-l;' t I[ r

D.O. No. fs CStA )/)o J1j,gl..-L ~ . ", /P _.. • • • f , Vi~wajcct Khanna, lAS, /~/~.-: -. _ ", :-~ >1fQ'l1.tf.n. , ' .~)\, Addl. Chil'''' Secretary _ f.~1. 'I/' <:; ~tf1f~ e - , ~ Ii.i. I" Government Dr Punjab \\\ (.1J!:,) s ~ 2741285 <~~, c · .~,:-~/ RO'cP(J '1" 1<- , ~'i ll . ~'l~~~ A;~ ~~ tJ - t H'1 ~ ,i, 1; , . Department of .civil Aviation W,JraT Chandigarh, th... e&ldl~ s" February, 2017

Subject: Non-inclusion of land cost as a part of RAB- In the matter of Determination of Aeronautical Tariffs in respect of CIUAL for the first Control Perlud (01.04.2016 - 31.03.2(21) by AERA )~ ~~~J~ '~ /

This is with reference to File No. AEIW 200 10/ MYTP/ CHIALI CP-JI/ 2016-17, Consultation Paper No. 3/ 2016-17 dated 14.02.2017. Chandigarh International Airport Limited (CHIAL) is a joint venture company incorporated under Companies Act, 1956 by Airports Authority of India (a Government of India Enterprise) having 51 % Equity Stake, in association with Punjab Government through Greater Mohali Area Development Authority (UMADA) having 24.5% Equity Stake and Haryana Government 'through Ilaryana Urban Development Authority (HUDA) having 24.5% Equity Slake to operate and maintain Chandigarh International Airport which has corne up as a new stale of art International Airport at Mohali, Punjab.

Punjab Government acquired the Land as an investment in Cl HAL. The cost of Land has subsequently been equally shared between the Government of Punjab and I-Iaryana and has been capitalized in the books of eUIAL. It has been counted towards the equity contribution of UMADA and IIUDA as per the original Moll and subsequent agreement between the three joint Ventures & partner i.e. Airport Authority of India, Government of Punjab and Government of llaryana. Thus, the cost of Land is the part of Project Cost.

It is to submit that land is a cash resource and very costly. If we require the Stale Government to promote further construction of new Greenfield Airports and the cost of land is not taken for RAil purposes, then thi s model will Iail and no State Govt. in future will be willing to or be able to alford to part with land. . . ;f) ! ., \ . - -,­

...... j::: ':: . 2' resulting in stagnation in' creation of infrastructure for civil aviation purposes. It is requested that the Ministry should endorse our stand that land cost should be considered a part of RAB and an aeronautical asset for ARR dctennination which will help in making projects viable.

With regards,

Mr. Arun Kumar,

Joint Secretary I Ministry of Civil Aviation Government of India, Rajiv Gandhi Bhawan Safdarjung Airport, New Delhi-lID 003.

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