Ghost airports highlight risks of India's infrastructure drive

Jaisalmer airport was completed 21/2 years ago, but not a single passenger has passed through its gates.
Jaisalmer airport was completed 21/2 years ago, but not a single passenger has passed through its gates.PHOTO: REUTERS

JAISALMER (India) • Two-and-a- half years after the completion of a new US$17 million (S$24 million) terminal building, the airport in Jaisalmer, a small and remote desert city in India's western Rajasthan state, stands empty.

Not a single passenger has passed through the gates of an airport big enough to handle more than 300,000 travellers a year.

India has spent over US$50 million since 2009 on eight airports not receiving scheduled flights - white elephants that are a reminder of the pitfalls for Prime Minister Narendra Modi as he bets on an infrastructure drive to fuel growth.

India's main hubs, meanwhile, are bursting at the seams, slowing airlines' ability to expand in a vast country where they should be supporting economic growth.

SpiceJet chief operating officer Sanjiv Kapoor said: "The government needs to realise it's not a case of build an airport and we'll come."

India's ghost terminals were built largely by the previous government, which planned 200 "no frills" airports, encouraged by rising air travel and the need to connect far-flung regions.

The civil aviation ministry declined to comment on whether Mr Modi's government would stick with the growth plan. But the incentive to grow in less-developed regions remains. On Tuesday, Mr Modi pledged 27 billion rupees (S$580 million) for four new airports in the impoverished state of Bihar.

Mr Kapil Kaul, Delhi-based chief executive at consultancy Capa - Centre for Aviation, said: "The AAI (Airports Authority of India) has invested in some airports without any economic logic. Every state government wants to have a big airport, but you have to... ask where do we need airports, where are the demand and growth from?"

Mr S.K. Singh, local AAI director, defended the Jaisalmer airport, saying the city has a growing tourist industry and the nearest functioning airport is 290km away.

Airlines are not so sure.

Mr Kapoor said demand was linked to Jaisalmer's cooler winter months, making it tough to lure enough passengers.

Analysts said the government would need to cut landing charges or provide funding to entice carriers. "If that doesn't work, it's better to lock up the airport and redeploy staff," said Mr Amber Dubey, an aviation expert at KPMG.

REUTERS

A version of this article appeared in the print edition of The Straits Times on August 20, 2015, with the headline 'Ghost airports highlight risks of India's infrastructure drive'. Print Edition | Subscribe