3. Need of this project in 2006
The process of opening up the sky, launch of several new private carriers,
the much-awaited fleet acquisition programme of public sector airlines and modernisation of airports also went ahead with full-steam during 2004.
FDI
The FDI inflow in the Indian aviation
industry between April 2000 and
2006 was over $931 mn
01
Civil Aviation Policy
The government was planning to
finalise a new Civil Aviation Policy
and present it to Parliament in the
Budget Session to create a roadmap
for the next decade.
02
Existing insufficient
infrastructure
The existing airport in Delhi were
insufficient for the expected traffic
of business and pleasure travelers
03
International Travel
Jet Airways and Air Sahara have
already been designated for
operations to Sri Lanka, Nepal and
Bangladesh against the unutilised
entitlements of the Indian side.
04
Mumbai & Delhi
The work on modernising and
restructuring Delhi and Mumbai
airports is likely to begin by the
middle of 2005 after the process of
inviting technical bids and further
shortlisting the bidders is over by
March next. The two projects would
cost over Rs 20,000 crore.
05
Future Plans
An ambitious Rs 40,000 crore
modernisation plan for 25 airports
through public-private partnership
was also announced recently and
55 other airports have been
identified for modernisation in the
next five years.
06
Introduction Project Course Project Financials
4. T3 Area 5,53,887 sq. m.
Passenger Capacity (annual) 3.4 Crore
Check-in counters 168
Immigration counters 95
Baggage reclaim belts 14
Runways 3
Aircraft parking bays 30
Security Channels 30
Travelators 92
Escalators 34
Lifts 63
Retail space area 20,000 sq. m.
Car parking capacity 4300
Magnitude of the project:
Project Details:
Project Management Triangle:
Project Stakeholders:
Introduction Project Course Project Financials
TERMINAL – 3
Project Terminal 3–Phase 1Bof the development project
Projecttype PPP Joint Venture
Owner Airport Authority of India
Scheduledcompletiontime March 2010
Importance
Commissioningin July forthe Commonwealth Games in the first week of October.
Combined the domesticand international terminal to make Delhi an international hub
Scope:
Built to facilitate the 2010Common Wealth Games held in Delhi which can handle 34
million passengers a year
Time:
Construction of the airport terminal was started in February 2007and completed on fast-
track in 37months, by March 2010
Cost overrun:
Project cost was estimated to be INR 9000crore, but the actual cost has gone up to INR
12000Crore
Reasons forcost overrun: Increase in floor area and cost of materials like steel and glass
5. Project Management Triangle: Challenges
Cost
• Original cost approved- INR 8975 crore in
2008
• Actual Project Cost- INR 12857 crore in 2010
• (As per AERA approval- INR 12502 crores)
• What should have been done?
• Equity, Debt, Security Deposits
• What Happened?
• Financial gap was met by levy of DF (Airport
Development fees)
Time
• 15 Mandatory Capital Projects were supposed
to be completed by 3rd April,2008. 11 MCPs
were delayed from 87 to 236 days
• What should have been the punishment?
• No incentive in respect of base airport charges
• What they got?
• 10% increase on aeronautical charges(undue
favor to DIAL)
Scope
• Conflicts between OMDA & AERA Act
in defining aeronautical & non-
aeronautical services
• Conflicts over the retirement
compensation fund where INR 250
crores was supposed to be paid
• Funds diverted from PSF to favor DIAL
Introduction Project Course Project Financials
7. Project Management Triangle:
1. Scope: Change in scope during design phase and area. Quality was not compromised at all.
2. Time: Completed on time
3. Cost Overrun: Out of the total capital expenditure of INR 12857 crore claimed by DIAL, AERA has admitted
INR 12502.86 crore as the total project cost. The funding gap to the tune of INR 3415.35 crore was permitted
by AERA to be collected from the passengers through levy of DF which was not envisaged in OMDA and SSA.
Reasons for cost overrun: (42% overrun -> but within limit)
• Cost estimated for 7,00,755 sq. m. and work done for 9,47,000 sq. m. (change in scope -> Additional INR 1015
Crore)
• Requirement of reinforcement material increased nearly 2 times
• Cost of steel has increased from INR 27,000/MT to INR 43,143/MT
Corrective measures: (without compromising quality)
• Change of cables from Copper to Aluminum for HT lines
• Combining local make with foreign make for electrical high end fittings has resulted in cost savings
Introduction Project Course Project Financials
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