Lack of Interest Delays Outsourcing Plan for Islamabad International Airport
Lack of Interest Delays Outsourcing Plan for Islamabad International Airport

The bid submission date for the outsourcing of Islamabad International Airport (IIA) has been extended by the Aviation Division to March 15, 2024, due to a lack of interest from potential bidders. Initially, four companies expressed interest in managing the airport, but recent developments suggest a decline in international interest, primarily attributed to the perceived stringency of the criteria.

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The plan to outsource IIA was approved by the previous government, which set a deadline of November 8, 2023, for bid submissions. In August, the Executive Committee of the National Economic Council (ECNEC) approved the outsourcing of IIA under the Public-Private Partnership (PPP) mode. The government aimed to raise capital and modernize the airport’s existing infrastructure by attracting private sector participation.

According to the Planning Commission, the project’s present value under the proposed PPP mode was estimated at $434 million, while the traditional mode had a present value of $409 million. Option-1 (PPP mode) was deemed more financially attractive, generating an additional net value of $25.65 million.

The concession period was set at 15 years, with an estimated project cost of $135 million, including an upfront payment of $100 million to the Civil Aviation Authority by the successful bidder. Despite the initial interest, the lack of recent interest has prompted the extension of the bid submission date.

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