Zurich Airport International AG’s bid for Jewar Airport

Switzerland’s Zurich Airport International AG emerged as the highest bidder for the proposed international airport at Jewar, Uttar Pradesh. DSK Legal advised Zurich Airport International AG with respect to its bid to develop the greenfield Noida International Airport at Jewar on a design, build, finance, operate and transfer basis. The bid was floated by Noida International Airport Limited.

The team were led by Managing Partner Anand Desai and Partner Anuja Tiwari. We speak to the DSK Legal Team below.

Please tell us about your involvement in the deal.

We were involved as legal advisers to one of the bidders, Zurich Airport International AG (ZAIA). After the opening of the technical and financial bids of all bidders, ZAIA was declared the selected bidder for the development of the Jewar Airport project. During the bid advisory phase, we were providing legal advice to ZAIA on the bid documents, the concession agreement and the technical bid. We were involved in every step of the bid submission process and assisted the bidder in putting the successful bid together.

Why is this a good deal for all involved?

This is a large scale project that has kickstarted a lot of interest from Swiss companies that were sceptical about entering the Indian market.

The proposal for the Jewar Airport is beneficial for ZAIA as well as the bidding authority and general public. ZAIA had exited from the Kempegowda International Airport SPV in 2007, and since then has been looking for re-entry into India’s aviation sector. The Jewar airport project presents itself as a marvellous opportunity for a re-entry as: (i) it is a greenfield airport; (ii) the airport is a necessity since traffic projections show that the Delhi Airport will soon reach peak capacity; (iii) since the site of the airport and surrounding areas are relatively undeveloped, they present a unique opportunity to the bidder to undertake city side development. The airport project is also beneficial for the state of Uttar Pradesh which is looking at the project as an opportunity for overall development in the area, which will also create job opportunities, raise standards of living, and facilitate economic growth.

What challenges arose? How did you navigate them?

Overall, the bid submission was a smooth process. However, as ZAIA was entering in India as a foreign entity without having a place of business in India, there were some concerns and issues relating to the land acquisition for the project, obtaining permits, consent and performance of certain obligations of the concessionaire under the concession agreement. We were able to reassure ZAIA on these issues, legally assess the risks, and suggest mitigants. We also interacted with the authorities on behalf of ZAIA, to ensure a seamless procedure.

A current focus area of the government is our infrastructure, including in core sectors like the railways, roads, ports, airports. India is looking to open up these sectors and encourage private participation through divestment and other avenues of project development.

How does this deal shape the potential 2020 investment scene?

This is a large scale project that has kickstarted a lot of interest from Swiss companies that were sceptical about entering the Indian market. A Swiss conglomerate having been awarded a project of this magnitude has put a positive light on the Indian market as an investment opportunity. This should garner a lot of interest in both PPP and private sector projects from many European entities.

What other sectors do you think we should keep an eye on for 2020?

A current focus area of the government is our infrastructure, including in core sectors like the railways, roads, ports, airports. India is looking to open up these sectors and encourage private participation through divestment and other avenues of project development. We expect a lot of traction in these sectors, and investors and developers should expect more opportunities in these sectors. The government is also looking to introduce new models for monetization of public assets, including operational assets. All in all, this is a very exciting time to be investing in India.