INDIA. The Airports Authority of India has published a tender notice for the development and operation of duty free stores at nine Indian airports.
Shops at Kolkata, Chennai, Trivandrum, Goa, Ahmedabad, Bangalore, Hyderabad, Calicut and Gaya are all up for tender in a contest that is likely to attract the attention of many of the industry’s leading retailers.
Sale of the tender documents will commence 12 June and end on 26 June. Interested parties can bid for any or all of the airport retail opportunities. The stores are currently run by India Tourism Development Corp (ITDC).
Bids must be in by 1500 on 5 July 2006, with the opening of technical bids to take place an hour later. The date for the opening of financial bids has not been indicated.
While the tender allows opportunities to operate in some of the country’s biggest and fastest-growing airports, industry sources underline some key complexities.
Bangalore and Hyderabad airports, for example, have both been privatized, with new airports to open early-2008. This suggests that the actual operations of duty free at Bangalore and Hyderabad as included in this tender could last just over a year. Chennai is also expected to come up for privatization, thus possibly disrupting the duration of operations. However such factors are unlikely to dampen interest given the boom in Indian air travel.
“Because of these changes, some of the bids could be for five years and others for shorter terms,” one certain bidder told The Moodie Report today.
At other airports, irregular traffic poses a problem. At Gaya airport, for example, there is currently only one flight per week. In Goa, the tourist season lasts only for about five months in a year – between November and March. With the process of operating licenses and approvals taking up to half a year, the operator will probably only be able to start doing any serious business from November 2007.
At Ahmedabad, liquor cannot be sold at the arrivals store as Gujrat is a dry state. Liquor and tobacco make up the two main pillars of duty free sales in India.
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