Airports Authority of India allowed to exercise mini-ratna powersJanuary 13th, 2009 - 10:42 pm ICT by IANS
New Delhi, Jan 13 (IANS) The government Tuesday appointed HDFC chairman Deepak Parekh, industrialist Sajjan Jindal and architect Hafiz Contractor as non-official directors of the Airports Authority of India (AAI), allowing it to exercise powers of the “mini-ratna” status conferred on it last month.With the new appointments, the state-run airports operator can now exercise its powers of autonomy in terms of investment in projects and can also form joint ventures (JVs).
According to guidelines of the Department of Public Enterprises (DPE) - which confers mini-ratna status on state-run units - the category-I mini-ratna company (as is now the case of AAI), is allowed to incur capital expenditure on new projects, modernisation, purchase of equipment without government approval up to Rs.3 billion (Rs.300 crore), or equal to its net worth, whichever is lower.
Currently, AAI has to seek government approval for any project exceeding Rs.1.5 billion (Rs.150 crore), said the government.
According to sources, the restructuring of the AAI board has been pending for a year.
AAI earned a profit of around Rs.1,000 crore (Rs 10 billion) for 2007-08, out of which it paid a total dividend of Rs.2.16 billion (Rs.216 crore) to the government.
AAI has been provided with budgetary support only to implement government-sponsored projects of national interest and research and development projects which do not disqualify it from the status.
However, in such projects, investment decision will be taken by the government and not AAI.