Apparently in front of the Hon'ble Vacation Judge, both Govt. and BIAL lawyers have confirmed that a capacity study will be undertaken, and if needed as a solution , to speedily re-open HAL airport to serve as a second airport of Bangalore.

This was also tacitly admitted by BIAL management during their press conference yesterday.

So this is a solution in the making.

However, to prevent the lack of transparency, in my humble opinion, Praja members should write to the Civil Aviation minister and ask that the public be involved and the study be done in full view, to ensre transparency.

My Patel's contact details are available at his website. 

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://aviation.deveshagarwal.com

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More info on this story:

http://www.hindu.com/2008/05/23/stories/2008052355500800.htm

http://www.hindu.com/2008/05/23/stories/2008052355350600.htm 

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Devesh,

Ab to muskaro do.

Syed

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If you recall, I raised two hypotheticals about future expansion of BIAL. (1) They do not have intent and (2) They do not have ability i.e. funding.

Over the last few days, I am seeing a trend and getting some hints from various people.

A major hypothetical to consider, and remember, as per the CA, for whatever reason, we cannot evict BIAL for the next 9 years.

What if BIAL does not have any more money ?

Siemens is the major source of funding. Just suppose they have decided to shut off the tap, saying, till the government does not agree on our UDF demands, we will pump in any more money.

What happens to Bangalore then ? Many of us have not paid adequate attention to the new paper stories a few days ago that Bangalore's economy is already slowing down, and business has been and continues to be diverted to Chennai and Hyderabad.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://aviation.deveshagarwal.com

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 Devesh,

 uncertainties like slowdown in economy and shifting of business oppurtunities neither can be avoided nor it can be predicted in perfect sense.

 Globally, economy is slowing down and India can not remain insulated from that impact for very long. Naturally, Bangalore's economy is going to take a hit. We like it or not. This would be the case if recession, oil prices are continue to rise globally and locally. Of late B'lore economy is more Service oriented, there are are high chances that it might take a big hit specially in Software and ITES.

    We can blame it any body or ourselves. We got BIAL, what ever its state and condition. The 9 year exit clauses and B'lore's dependance on Mr. Brunner and his team is a harsh reality. I am not sure BIAL private paretners would be willing to start investing for expension before raking the profits from 1st phase. You also as a business man, I don't think would just go ahead and invest the money right away given the circumstances. I will not be surprised to hear about unwillingness of Siemens/Zurich to fund it externally rightaway. That is a risk that we all need to understand and get ready for it. I am not sure if there was any risk analysis done on BIAL project from Siemens side or GOK side. I would like to read the report if exists.

 Given that risk, MoCA and GOK should play their role in pressurising BIAL for expediting the needed expansions. In that Industry should play a greater role in pushing GOI and GOK for their extra efforts and energies. Industry role should not just stop at "Open HAL" stance. Industry should step up to fill the gaps that exist in making BIAL a boon to Karnataka. How?

 For example, supporting ventures to providing private particiaption in bolstering transport and road infrastructure to the airport and city. Even financing for next expansions from Industry should be considered. We need to prove that we care for Bangalore before we ask Mr. Brunner to care for our City.

 Devesh, it is not the end of road for Bangaloreans in BIAL project. They have 2 aces to be used. MoCA and GOK. 

 Let's use them.

Syed 

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 Hi Syed

Given that risk, MoCA and GOK should play their role in pressurising BIAL for expediting the needed expansions.

This is precisely my point. If BIAL does not have the money for the needed expansion, then what ? All the pressure in the world will not matter, would it ?

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://aviation.deveshagarwal.com

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Devesh,

 I got your point. If the economy really slumps and market shrinks, there is nothing much you and me can ask from BIAL for expansions.

But now we have a chance. There is a visible possibility of growth and revenue from day one. That should be tempting for BIAL to expand.

 As you had commented about "Tents", why would Mr. Brunner would even talk of expanding temporary? That indicates he sees a potential growth and business oppurtunity for more revenue. Otherwise untill few weeks he did not even conceded that BIAL needs immediate expansion. Full house from 1st day is pushing BIAL to consider expansions.

 Lets come back to your original question. BIAL doesn't have money for expansions. I would approach this issue from different angles.

 1. Is there any CA obligations from BIAL for expansions? Given the BIAL experience so far, my take is our babu's would not have considered that important aspect. If not, then BIAL can not be forced to do anything outside of their commitment.

 2. Would the BIAL be willing to borrow from financial institutes? Also a question to be asked is, is financial institutes are willing to lend it to BIAL?

 3. Will they be willing to go public to raise funds for future expansions? I am not sure what would be the impact of such approach given the private participation in BIAL.

 What's your take on this?

Syed 

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Devesh,

Sorry - but where did this come from?  Why suppose this sort of thing?  There are capital markets - Zurich is a big financial hub.  If BMTC can mull an IPO, then why should BIAL have a problem raising capital?

We might as well suppose a lot of things - that the Indian economy might grow at only 4% for the next 5 years, that the aviation industry might actually have negative growth given the huge profits they churn out and how crude has been climbing since 1999 (12X).

Srivathsa

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GOK should put in the finances and increase its stake to a majority partner. It can float bonds to the public to raise money. If UDF is going to be shared amongst all partners GOK can pay of the interest on the bonds also without breaking a sweat. Bond interest does not even cover for inflation these days

I dont know how many public utilities have gone in for a listing and successfully sustained earnings to not get pummelled at the markets.  The last thing you want is higher UDF to cover for lesser flights during downturn just to meet street expectations.

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