Another House panel to look into CAG report on DIAL

Committee on Public Undertakings seeks details of DIAL-AAI contract

New Delhi, Oct. 16:  

Fresh trouble is brewing for Delhi International Airport Ltd (DIAL).

Yet another Parliament panel, the Committee on Public Undertakings (CoPU), has decided to consider the Comptroller and Auditor General’s (CAG) report on implementation of public-private partnership project by Airports Authority of India (AAI) at Indira Gandhi International Airport, Delhi.

While the Public Accounts Committee has already started deliberations on the report, the committee on subordinate legislation of the Rajya Sabha is verifying the AAI (Major Airports) Development Fees Rules, 2011, which empowered DIAL to levy fee from passengers.

The CoPU, headed by senior Congress MP Jagadambika Pal, will be looking at the implementation of operation, management and development agreement (OMDA) signed by the AAI and DIAL. It will particularly look into paragraph 2.3 of the CAG report, which discussed the concession period provided to the developer, allegedly violating a Cabinet note in 2003. Sources in the panel said the CAG will make a presentation on the report at its meeting here on Thursday.

CoPU is likely to call key officials of Civil Aviation Ministry, AAI and Airports Economic Regulatory Authority on the issue for the details of the contract between DIAL and AAI.

“This is a serious report. All CAG reports that comment on public sector undertakings will be reviewed,” a panel member said.

The CAG report, tabled in Parliament during the winter session, had said that a Cabinet note in 2003 said the existing 30 years’ concession to the developer on traffic volumes, tariffs, concession period and capital costs could be extended by another 30 years only after a mutual agreement and negotiation of terms by the developer and AAI.

“However, as per the final bid documents, the ‘subject to mutual agreement and negotiation of terms’ was left out,” the report had said, adding that the OMDA, signed in April 2006, did not contain any provision of mutual agreement and fresh negotiations before extension of the concession period.

The report had pointed out that DIAL got the right to extend the term for another 30 years because of this lapse.

“This is not only a violation of the commitment in the initial Cabinet Note but also unilateral and unfair advantage given to DIAL which is detrimental to Government interest, as it does not provide the Government any scope for review of any of the conditions in OMDA and SSA,” the CAG had added.

http://www.thehindubusinessline.com/todays-paper/tp-economy/another-house-panel-to-look-into-cag-report-on-dial/article4003465.ece