Hyderabad Evaluation Report 25092017

9/25/2017
Analysis of Capital Expenditure

on Expansion of Terminal
Building and Apron at Rajiv
Gandhi International Airport,
Shamshabad, Hyderabad
Evaluation Report
RITES LIMITED
Analysis of Capital Expenditure on expansion of Terminal Building and Apron at Rajiv Gandhi International Airport,
Shamshabad, Hyderabad for second control period (01/04/2016 to 31/03/2021)
OM SRI GANESHAYA NAMAH
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Contents
1. INTRODUCTION ......................................................................................................................... 5
1.1. Background ................................................................................................................................. 5
1.2. Scope of Services......................................................................................................................... 6
1.3. The Study Team .......................................................................................................................... 6
1.4. Data Collection ............................................................................................................................ 6
1.5. Report ......................................................................................................................................... 7
2. PROPOSAL BY HIAL.................................................................................................................... 9
2.1. Expansion Proposal ..................................................................................................................... 9
2.2. Capital Cost Proposal ................................................................................................................ 10
3. TRAFFIC REVIEW...................................................................................................................... 11
3.1. Project Information File ............................................................................................................ 11
3.2. Air Traffic Forecast by ICF Limited (2015) ................................................................................. 11
4. GOVERNING PARAMETERS...................................................................................................... 14
4.1. Report of the Inter Ministerial Group (IMG) on Norms & Standards for Capacity of Airport
Terminals (2009) ....................................................................................................................... 14
4.2. AERA Order No. 07/2016-17 ..................................................................................................... 15
5. EVALUATION OF THE PROPOSAL ............................................................................................. 19
5.1. Capacity Constraints ................................................................................................................. 19
5.1.1. Expansion of the Terminal Building ...................................................................................... 19
5.1.2. Capacity Calculation of Passenger Terminal Building ........................................................... 20
5.1.3. Expansion of the Kerb and Approach ramp .......................................................................... 24
5.1.4. Pier Expansion ....................................................................................................................... 26
5.1.5. Expansion of Apron ............................................................................................................... 27
5.2. The Capital Cost Proposal ......................................................................................................... 29
5.2.1. General .................................................................................................................................. 29
5.2.2. Expansion of the Terminal Building ...................................................................................... 29
5.2.3. Expansion of the Kerb & Approach Ramp ............................................................................. 31
5.2.4. Expansion of Apron ............................................................................................................... 31
5.2.5. Others ................................................................................................................................... 33
5.2.5.1. Preliminaries (Construction) ............................................................................................. 33
5.2.5.2. Insurance & Permits .......................................................................................................... 33
5.2.5.3. Design Development ......................................................................................................... 33
5.2.5.4. Supervision ........................................................................................................................ 33
5.2.5.5. Contingencies .................................................................................................................... 34
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5.2.5.6. Interest during construction ............................................................................................. 35

5.3. Comparison of Basic Cost .......................................................................................................... 35
5.4. Construction Schedule .............................................................................................................. 37
6. FINDINGS ................................................................................................................................ 38
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Abbreviations
AERA Airports Economic Regulatory Authority of India

AAI Airports Authority of India
ATM Air Traffic Movement
GoI Government of India
GHIAL GMR Hyderabad International Airport Limited
HIAL Hyderabad International Airport Limited
IMG Inter-Ministerial Group
IATA International Air Transport Association
ICAO International Civil Aviation Organization
IRA Independent Regulatory Authority
MARS Multiple Aircraft Ramp System
MoCA Ministry of Civil Aviation
MPPA/mppa Million Passenger per Annum
Mn million
MYTP Multi-Year Tariff Proposal
PPP Public Private Participation
PHP Peak Hour Passenger
RCC Reinforced Cement Concrete
TRB Transport Research Board
UDF User Development Fee
WPI Whole sale price Index
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1. INTRODUCTION
1.1. Background
Development of new greenfield international airport at Hyderabad through PPP was awarded to
Hyderabad International Airport Limited (HIAL) and the concession agreement was signed
between HIAL and the Ministry of Civil Aviation (MoCA) on 26th December 2004. The Airport was
commissioned in 31 months, designed for a capacity of 12 million passengers per annum (mppa)
and 1,50,000 tons of cargo handling capacity per annum. The airport was inaugurated on 14th
March 2008 and started the commercial operations from 23rd March 2008.
Salient features of the concession agreement relevant to this report are highlighted below:
Nature of Agreement - Concession agreement for Development, Construction, Operation and

Maintenance of Hyderabad International Airport between Ministry of Civil Aviation - Government
of India and Hyderabad International Airport Limited
Concession
GoI grants HIAL the exclusive right and privilege to carry out the development, design, financing,
construction, commissioning, maintenance, operation and management of the Airport (excluding
the right to carry out the Reserved Activities and to provide communication and navigation
surveillance / air traffic management services which are required to be provided by AAI)
 Scope of the Project: Development and Construction of the Airport on the site in accordance
with the provisions of the agreement, Operation and maintenance of the airport and
performance of the Airport Activities and Non-Airport Activities in accordance with the provisions
of the agreement, performance and fulfilment of all obligations of HIAL in accordance with the
provisions of the agreement
 Fee: HIAL shall, in consideration for the grant by GoI of the Concession pursuant to Article 3.1,
pay to GoI a fee amounting to four per cent (4%) of Gross Revenue annually on the terms
specified.
 Charges: The Airport Charges specified in Schedule 6 (Regulated Charges) shall be consistent
with ICAO (International Civil Aviation Organization) Policies. The Regulated charges set out in
Schedule 6 shall be indicative charges. Prior to Airport Opening HIAL shall seek approval from the
Ministry of Civil Aviation for the Regulated Charges, which shall be based on the final audited
project cost. From the date the Independent Regulatory Authority (IRA) has the power to
approve the Regulated Charges, HIAL shall be required to obtain approval thereof from the IRA.
 Term: 30 years
The shareholding pattern of GMR Hyderabad Airport Limited as on 31.03.2016 is as under:
GMR Airports Limited, Holding Company - 63%

Airports Authority of India - 13%
Government of Telangana - 13%
MAHB(Mauritius) Private Limited - 11%
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1.2. Scope of Services
There is a proposal for Expansion of Existing Terminal Building and Apron at Hyderabad
International Airport. The project consists of Civil, Electrical, Equipment, Air-Conditioning etc.
GHIAL has submitted their capital cost proposal to AERA for the second control period
(01/04/2016 to 31/03/2021). AERA has appointed RITES vide letter dt. 12th June 2017 to examine
the same.
The scope of services assigned to RITES include
a) To examine the proposal of the airport and assess the need for the proposed project and
its capacity/scope with reference to Passenger growth/Cargo Volumes/Air Traffic
Movement and also to suggest cost effective alternatives
b) To examine the building standards and designs proposed by the airport operator in line
with IMG norms/IATA/ICAO norms
c) To analyze the reasonableness of the proposed cost with reference to the tentative
ceiling decided by Authority vide order no. 7 dated 13/06/2016 based on the details of
the rates and quantity as per government/industry approved norms and advise the
Authority on the reasonableness of the costs
d) To review designs and specifications proposed in case the costs are assessed to be
excessive where the Projects are already in progress or the contracts are already
awarded. Further to examine whether proper procedures have been followed in the
award of the work
e) To assist AERA in case any litigation arises in future in connection with the
reasonableness of the cost estimates
f) To review and justify the reasonableness of time schedule of completion of work of
proposed by HIAL
g) To perform any other duties as may be deemed necessary and specified in the award
letter
1.3. The Study Team
The following team has been formed by RITES to undertake the assignment:
SN Name Designation
1. Mr.Pawan Chowdhry Group General Manager/Airports
2. Mr.N.Ganesh Babu Jt.General Manager/Airports
3. Mr.N.S.Rawat Jt.General Manager/Airports
4. Mr.Abhas Kumar Sr.Dy.General Manager/Airports
5. Mr.Ashuthosh Jaspal Sr.Dy.General Manager/Airports
6. Mr.V.S.Solanki Sr.Dy.General Manager/Airports
7. Mr.Vivek Kumar Assistant Manager/Airports
8. Mr.Saurabh Pareek Assistant Manager/Airports
1.4. Data Collection
The following data has been collected and studied:
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 Airport Expansion & Capex Proposal, Project Information File (PIF) for Airport Users
Consultation, September 2015 submitted by GMR Hyderabad International Airport
Limited
 Concession Agreement for the Development, Construction, Operation and Maintenance
of the Hyderabad International Airport between Ministry of Civil Aviation, Government
of India and Hyderabad International Airport Limited dt. 20th Dec. 2004
 Order No. 07/2016-17 dt. 13th June 2016 issued by AERA in the matter of Normative
Approach to Building Blocks in Economic Regulation of Major Airports – Capital Costs
Reg.
 Letter No. GHIAL/2016-17/SPG/1298 dt. 22nd March 2017 by GMR forwarding the
descriptions for the various elements of the project along with area and cost estimates
 Letter No. GHIAL/2017-18/SPG/1303 dt. 29th April 2017 by GMR forwarding the detailed
project cost break-up along with quantities and unit rates & drawings
 Cost estimate for RGIA expansion project
 Final Report on Hyderabad International Airport Traffic Study by ICF Limited, January
2015
 Geo technical investigation report by Geo Technologies, Nov – Dec 2016
 RGIA Update Master Plan – 2014, Summary Report by GMR, Jan. 2015
 Master Plan Review 2016, Final Report, RGIA by Landrum-brown, April 2017
 Request made by various Airlines for night parking
 Planned Work Schedule submitted by GHIAL
1.5. Report
Based on the study of data provided by HIAL and field visit to Hyderabad, the draft report was
prepared and submitted to AERA on 14/07/2017, followed by a power point presentation on
20/07/2017. As advised by AERA vide letter dt. 3/8/17, the findings were also discussed with HIAL
on 08/08/17. The following additional data has been submitted by HIAL on 11/08/2017.
 Calculation of price escalation based on CIDC price index

 Project Investment File for Terminal Development at Cochin International Airport by
KPMG, June 2013
 AERA order No. 07/2016-17 DT. 06/06/2016 in the matter of normative approach to
building blocks in economic regulation of major airports – Capital Costs reg.
 Extracts from AERA order No. 07/2017-18
 Reserve Bank of India circular dt. 14/08/14 on prudential norms on income recognition,
asset classification and provisioning pertaining to advances – Projects under
implementation.
 Draft Indian Standard Doc. CED 29(7906)WC dt. Oct.2013
 Extracts from the Final report for Technical Audit for midterm review of MIAL’s project
Cost Estimates for AAI submitted by EIL
 List of design development contracts already awarded totaling to Rs.37.07 Crores
 GHIAL Gross Block as on 31st March 2011
 Documents in support of water charges paid by HIAL
 Apron Development Plan
AERA vide letter No. AERA/20010/Normative Approach/2014-15/Vol- II/pt.file/13061 dt.

24/08/2017 asked RITES to submit the final report. Accordingly, this final report is submitted.
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This report sets out the findings by RITES of the need for expansion of existing infrastructure and
capital cost thereof at Hyderabad International Airport on behalf of the AERA. This exercise is
undertaken to assist AERA in assessment of capital expenditure and determination of UDF
thereof. It is important to note that the findings and outputs are provisional and that the capacity
analysis is subject to consultation and refinement.
The remainder of this report is structured as follows. Section Two describes briefly the proposal
submitted by HIAL; Section Three analysis of the Air Traffic; Section Four the governing
parameters; Section Five the Evaluation of the proposal and Section Six the Findings.
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2. PROPOSAL BY HIAL
2.1. Expansion Proposal
The submission made by GHIAL has been forwarded to RITES by AERA. The major components of
the proposed capital expenses include the following heads:
 Terminal Forecourt
o Expansion of Airport Forecourt by two modules
o Weather-proofing of Airport Forecourt
o Additional 3rd connecting bridge and central opening at departure level
o Increasing the circulation space at Airport Forecourt departure level by
providing a cantilever slab on the south side of ramp
o Four additional lanes for up and down ramp including associated works
 Expansion of the terminal
o East side expansion by 1 check-in module, leading to additional space of
14,806 sqm
o West-side expansion by 2 check-in modules, with additional space of 35,350
sqm
 Pier Expansion
o East-side pier expansion (addl. Space of 34,507 sqm) to accommodate 12
contact stands
o West-side pier expansion (addl. space of 16,512 sqm) to accommodate 5
contact stands
 Apron Expansion
o West side covering an area of 1,26,437 sqm for stands and access taxi
provision
 Expansion of the approach ramp & Kerb
The expansion proposal by GHIAL is summarized as under:
Description Present (2015) Proposed (2021)

Traffic (MPPA) 10.51 18.70
Peak ATM (Approved peak movement is 30 20 34
ATM/hr)
Peak pax (Departure) 1,836 3,244
Combined Peak 2,855 5,059
Arrival ramp capacity (Cars/Peak Hr.) 600 1,100
Departure ramp capacity (Cars/Peak Hr.) 1,100 2,000
In line Baggage Check-in counters 60 150
Emigration counters 22 33
Immigration counters 20 38
Total X-Ray channels required 12 23
Aircraft apron stands 42 52
Domestic contact gates 5 17
International contact gates 7 12
Total contact stands 12 29
Baggage carousals/claim unit Intr. (90m) 2 4
Baggage carousals/claim unit Dom. (90m) 2 3
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Description Present (2015) Proposed (2021)

Total baggage carousals/claim 4 7
Self-service/E-boarding NA 16 (E-gates)
10 (Self bag
drop)
2.2. Capital Cost Proposal
The total capital cost for expansion of the airport during the second control period is
estimated by GHIAL at Rs. 2224.26 Crores inclusive of insurance & permits, preliminaries
(construction), design development, supervision, contingencies and interest during
construction as per the break up given below. The proposal submitted by GHIAL is enclosed
at Annex ‘A’.
SN Description Area (sqm) Est. Cost (Rs. Crores)

1 Passenger Terminal Building 1,03,000 sqm 1449.82
2 Apron Development 1,18,734 sqm 129.38
3 Approach Ramp 108.50
4 Preliminaries 34.00
5 Insurance & Permits 20.00
6 Design Development 50.00
7 Supervision 92.20
8 Contingencies 105.10
Sub-total 1989
9 Interest during construction 235.26
Total 2224.26
Cost Distribution of Capital Expenditure
Passenger Terminal Building

11%
5% Apron Development
4%
Approach Ramp
2% 1%
1%
5% Preliminaries
6% 65% Insurance & Permits
Design Development
Supervision
Contingencies
Interest during construction
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3. TRAFFIC REVIEW
3.1. Project Information File
In the project information file submitted by GMR Hyderabad International Airports Ltd. in
September 2015, the following has been stated:
 Airport presently has passenger capacity of 12 MPPA

 Passenger traffic has grown from 6.2 mn passengers in 2009 to 10.5 mn passenger in
2015 (CAGR of over 9%)
 Post expansion, RGIA would have the capacity to handle around 20 MPPA
 The projected passenger traffic for FY20-21 is 18.7 million and the proposed
expansion is expected to meet traffic demand till 2022.
 The passenger terminal presently has the capacity of 3200 PHP
 The peak hour traffic will surpass the peak terminal capacity by 2016-17 and touch
5059 PHP by 2020-21. On a conservative basis, PHP terminal capacity to reach 4507
by 2020-21.
 There is capacity constraint at all process levels and needs expansion to meet the
target traffic of 2020-21.
 17 more contact stands (12 domestic and 5 international) are required to sustain
traffic till 2020-21, taking the overall contact gates numbers to 29 including 4 MARS.
 For the new addition of contact and remote gates the only option available would be
to expand the terminal piers linearly as stipulated by the current modular design.
 For catering to demand till 2020-21, it will require to add minimum of 1 claim belt of
90 m baggage claim for domestic and 2 Claim belts of 90 m for International. For
provisioning of the same, this will necessitate expansion of terminal both west and
east to accommodate the same.
 42 apron parking stands at present wouldn’t be sufficient to cater to traffic demand
till 2020-21.
 The total stand requirement for traffic projection for 2020-21 will be 52 apron stands,
i.e. addition of minimum 10 new aircraft stands.
3.2. Air Traffic Forecast by ICF Limited (2015)
 ICF Base case forecasts for Hyderabad airport reach 43 million total passengers by
2038 at a CAGR of 6.9% from 2014. The growth rate adopted is as given below:
CAGR Dom Intl. Total

FY14-20 12.0% 10.9% 11.7%
FY20-30 6.0% 6.4% 6.1%
FY30-38 4.2% 4.8% 4.4%
FY14-38 6.9% 7.0% 6.9%
As per the forecast, the passenger traffic will reach 18.445 million by 2021, with
13.638 million domestic passengers and 4.807 million international passengers.
As per actual, the total passenger traffic handled by the airport in the FY 2017 stood
at 15.10 million as against the forecast of 12.827 million. The international
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passengers handled remained at 3.37 million and the domestic 11.732 million as
against the forecast of 3.340 million and 9.487 million respectively.
 As per the forecast, by 2038, the airport will handle over 300,000 aircraft movements.
The growth rate adopted for air traffic movement is as given below.
CAGR Dom Intl. Cargo Total

FY14-20 9.1% 8.6% 8.0% 9.0%
FY20-30 5.1% 6.2% 4.9% 5.3%
FY30-38 3.5% 6.2% 5.1% 5.7%
FY14-38 6.9% 7.0% 6.9%
As per the forecast, the airport will handle 1,58,000 aircraft movement by 2021, with
1,27,000 domestic and 28,000 international passengers.
Passenger Traffic (2009-2017)

16000000
14000000
12000000
10000000
8000000
6000000
4000000
2000000
0
2009 2010 2011 2012 2013 2014 2015 2016 2017
Intl. Dom Total
It has been observed that the growth in international, domestic and total passengers
remained at 10%, 12.3% and 11.7% respectively during the period 2009 to 2017.
As per actual, the airport handled 3,370,061 international passengers and

11,732,611 domestic passengers in the FY 2017 vis a vis 3,340,000 and 9,487,000
predicted for the year. Thus, there is unprecedented growth witnessed in the
domestic passenger traffic.
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Aircraft Movement (2009-2017)

140000
120000
100000
80000
60000
40000
20000
0
2009 2010 2011 2012 2013 2014 2015 2016 2017
Intl. Dom Total
It has been observed that the growth in international, domestic and total passengers
remained at 7.9%, 5.9% and 6.2% during the period 2009 to 2017.
Average passenger per aircraft stands at appx. 150 for international flight and 108 for
domestic flight.
As per actual, the airport handled 22,261 international aircraft movements and
1,08,452 domestic aircraft movements in the FY 2017 vis a vis 20,000 and 91,000
predicted for the year. Thus, the traffic growth is more than projected.
It can therefore be concluded that passenger traffic of 20 million considered by

GHIAL for the year 2021 for the expansion of terminal building is likely to be
achieved ahead of time.
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4. GOVERNING PARAMETERS
4.1. Report of the Inter-Ministerial Group (IMG) on Norms & Standards for Capacity of
Airport Terminals (2009)
IMG has deliberated in detail on various key issues and made following recommendations:
A Growth Rate for Traffic Projections
Keeping in view the trend in air traffic in last few years, a span of five years be adopted for the
projects planned during the current five-year plan period, i.e., up to 2011-12. Thereafter, as
the growth rate stabilizes, the span for making projections should be increased to 7 years for
a more realistic assessment.
B Target year for Capacity Creation (Design Year)
Following norms could be adopted for capacity creation:
_ Smaller airports (< 5.0 mppa) – 10th year from Planning year.
_ Bigger airports (> 5.0 mppa) – 7th year from Planning year.
C Peak Hour Projections
Methodology given in ICAO Manual on Air Traffic Forecasting by finding ratios from historical
data and recent studies be adopted. As per ICAO Manual, forecasts of peak period passengers
are to be obtained from annual forecasts by applying ratios of busy period traffic to annual
traffic derived from actual data at various airports.
Actual data for the past five years should be analyzed to determine the Peak Hour Traffic and
the trend growth thereof. Projections for the Design Year should be made based on the trend
growth in the past. AAI should make arrangements for data collection of Peak Hour Traffic in
respect of all non-metro Airports, so that same is available at the time of planning expansion
of these Airports.
In absence of actual data, the Peak Hour Traffic may be estimated based on ratios given in
Table below.
SL.No Traffic (in mppa) Ratio for Ratios for Domestic

International Terminal
Terminal
PH/AD PH/AD
1 1.0 - 5.0 0.30000 0.250000
2 0.5 – 1.0 0.3500 0.3500
3 Less than 0.5 0.4500 0.4500
In the event that requisite data is not available for airports with traffic above 5 million
passengers per annum, the above ratio-based norms may be considered in the interim.
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D Level of Services in Target Year
Level of Services ‘C’ as per IATA Airport Development Reference Manual (Jan 2004) denotes
good service at a reasonable cost. Therefore, this level could be used for design for target
demand in the design year. The unit area specified in paragraph E below represents Level of
Service ‘C’. Net impact of this norm would be that in the initial years, the passengers may
experience LOS ‘A’ or ‘B’ and as the traffic increases LOS ‘C’ would be achieved.
E Unit Area Norms
Overall space/area norm should be such as to provide a reasonable level of service for all
components required in a Terminal Building. Commercial or Retail area providing amenities
like food & beverages, book shops, counters for car rental, vending machines, public rest
rooms etc., normally require 8-12 per cent of the overall area, and should be planned and
provided accordingly. In bigger airports, i.e., with annual passenger traffic exceeding 10
million, commercial area could be up to 20 per cent of overall area. Keeping in view the IATA
norms and discussion above, the norms as given in Table 4, are considered appropriate for
Indian Airports.
SL.No Nature of Terminal Area Norm –

Sqm/php
1 Domestic Terminals
a) Traffic up to 100 php 12
b) Traffic between 100 -150 php 15
c) Traffic between 150 – 1000 php 18
d) Traffic above 1000 php 20
2 Integrated terminal for handling both domestic and 25
international
3 International Terminals 27.5
F Unit Cost of Construction
IMG recommended that the Appraisal Committee should specify the ceiling unit cost and the
architects/engineers of AAI should plan and implement the project within the ceiling, subject
to revision on account of increase in WPI.
G Airports developed through Public Private Partnerships
In the case of airports developed through Public Private Partnerships, the project authorities
may adopt a case by case approach with respect to norms relating to unit area and unit costs.
Based on the judicious consideration of international best practices and financial viability, the
norms may be specified in each case prior to inviting bids for private participation.
4.2. AERA Order No. 07/2016-17
In the matter of Normative Approach to Building blocks in economic regulation of major

airports – Capital Costs, AERA Vide Order No. 07/2016-17 issued orders as given below:
i) Pending finalization of a norm in this regard after going through a more rigorous
process, the tentative ceiling cost of Rs.65000/- per sqm of the terminal building and
Rs. 4700 per sqm for the Runway/taxiway/Apron (excluding earthwork up to sub
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grade level) is approved as a reasonable benchmark for evaluating capital costs to be

incurred by Airport Operators of major airports for the purpose of tariff determination
on a tentative basis.
ii) The airport operators are advised to relook at the costs proposed in their submissions
and justify the increase, if any, over and above the ceiling rates as indicated above.
iii) The Airport operators are expected to evaluate the costs in adoption of various
alternatives finishes and the corresponding benefits that accrue to users in case of
adoption of such alternative higher specifications.
iv) In case the rates are higher than the ceiling rate approved by the Authority, the
justifications, so submitted by the airport operators on actual incurrence of the cost
shall be examined by a duly constituted Committee of experts to be constituted by
Authority and based on their recommendations the final costs will be adopted.
v) These ceiling rates shall apply only in case of new projects where the works are yet to
be awarded. In case of awarded projects, the capital costs will need to be examined
by the committee approved for the purpose.
While arriving at Rs. 65,000/sqm for the terminal building and Rs. 4,700 per sqm for the
runway/taxiway/apron, the cost of construction at Cochin International Airport has been
taken as bench mark as given below:
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5. EVALUATION OF THE PROPOSAL

5.1. Capacity Constraints
5.1.1. Expansion of the Terminal Building
HIAL has proposed to expand the terminal building by 1,01,175 sqm to handle around 20
million passengers per annum. The break up details of the proposed expansion is as under:
SN Project Proposed Addition to Built-up Area

1 Terminal Expansion:
East-side 14,806 sqm
West-side 35,350 sqm
2 Pier Expansion:
East-side 34,507 sqm
West-side 16,512 sqm
Total 1,01,175 sqm
The existing terminal building built in the year 2008 is spread over an area of 1,17,339 sqm.
The building has been designed to cater 3200 php and to handle 12 million passengers per
annum.
The additional area now proposed is 1,01,175 sqm to handle additional 8 million passengers
per annum.
While evaluating the proposal, the following aspects have been taken into consideration:
1. The existing terminal building was commissioned in 2008 before issue of guidelines on
area norms by the Inter-Ministerial Group and therefore the area norms of 25
sqm/passenger for the integrated terminal suggested by IMG cannot be applied either
individually for the additional capacity or overall.
2. The existing building is planned such that the expansion of the terminal can be undertaken
in modules of 36 m.
3. The pier expansion is guided by the area requirement of departure lounge for
international and domestic passengers and the gate requirements.
4. The expansion has to be undertaken matching with the existing plan.
A team from RITES visited the Airport and noted that make shift arrangements are being made
to meet the peak hour passenger demand in the check in area.
The passenger terminal building is seven level building, two levels for arrival process, two for
departures and three levels for baggage makeup/sorting and backup offices/services. The PTB
has handled approximately 15 MPPA traffic last year (2016) and the dwell times at check-in,
Security/Immigration/Baggage Claim processes are constrained, particularly during
consecutive 4-5 hour peaks in domestic process at morning/evening and at international
peaks observed late night/early mornings. These peaks get further aggravated during early
morning hours when domestic & international peaks overlap and also during festival seasons
and other important events in the project zone. Also, it is observed that the domestic &
international piers/hold areas are segregated in the existing PTB, thereby reducing utilization
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Sep 2017 19
for domestic traffic during non-peak hours on the international side. There is capacity
constraint and the need for expansion of the terminal is felt.
The expansion possibilities to a passenger terminal building in an operating airport can only
be along the sides i.e. parallel to runway as the building depth is restricted by apron on one
side and departure/arrival ramps on the other side. Therefore, the proposed expansion
modules as planned are the only areas where expansion is possible.
The traffic data shows that the domestic traffic has grown at a faster rate as compared to
international, the split is approximately 80:20 at present and a 64:36 split in traffic is projected
between domestic & international traffic for the year 2021 assuming that growth in domestic
traffic will stabilize due to large base size and the international traffic will increase further due
to small base size.
5.1.2. Capacity Calculation of Passenger Terminal Building
Existing Passenger Terminal Building
Existing Peak Hour Traffic (Annual 12MPPA)
Area Per Peak Hour Passenger = Total Build-up Area / Total Peak Hour Passenger
Existing Built-up Area = 117,339 Sqm
Unit area per Peak Hour Passenger (PHP) = 117339 Sqm / 6560 Sqm = 17.88 Sqm or say 18
Sqm.
which is well within the Inter-Ministerial Group (IMG) & IATA norms of 24-25 sqm per peak
hour passenger for an integrated airport terminal.
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Proposed Expansion to Passenger Terminal Building
Projected Peak Hour Traffic (2020-21)
Total Peak Hour Traffic in Design Year (2021)
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Expanded Area of Passenger Terminal Building = 2,20,339 Sqm
Unit area per Peak Hour Passenger (PHP) = 220339 Sqm / 8991 Sqm = 24.5 Sqm
which again is as per Inter-Ministerial Group (IMG) & IATA norms of 24-25 sqm.
It is also seen that the SQM Area Per Peak Hour Passenger has increased from 18 sqm per pax in
the existing building to approximately 24.5 sqm in the proposed expansion. But the same is
within the specified IMG/IATA norms and this increase in PHP area per pax (as compared to
existing) will also add flexibility to absorb additional traffic growth in future.
The required number of gates at an airport can be determined using the following equation:
𝑣𝑡
𝑛=
𝑢
Where:
n = number of gates required
v = design hour flow for departures or arrivals (aircraft / hour)
t = mean stand occupancy (hour)
u = utilization factor 0.6 – 0.8
n = 17 x 0.75 /0.6 = 21.25 say 22
Gate Demand Based on Enplaned Passenger per gate approach and Departures per gate
approach
The following gate demand has been worked out based on recommendations of IATA and TRB.
The Number of Contact gates required for International movement is worked out using
Enplaned passengers per gate and the same is tabulated below.
Enplaned Passengers per Gate Approach (International)

Year Annual Annual No of Enplaned per Enplaned Per
Enplaned Departures gates Gate Dept.
Passengers
2014 1364748 8500 7 195000 160.6
2015 1548433 10000 7 221200 154.8
2016 1651547 11000 7 235900 150.1
2018 1962202 12973 8 237600 151.2

2019 2138801 14089 9 238500 151.8
2020 2331293 15301 10 239400 152.4
2021 2541109 16249 10 245700 156.4
Similarly, the number of gates required for International movement were worked out using
the Departures per gate approach
_________________________________________________________________________________
Sep 2017 22
Departures per Gate Approach (International)

Passengers
2014 1364748 8500 7 1210 3.3
2015 1548433 10000 7 1430 3.9
2016 1651547 11000 7 1570 4.3
2018 1962202 12973 8 1600 4.4

2019 2138801 14089 9 1620 4.4
2020 2331293 15301 9 1640 4.5
2021 2541109 16249 10 1660 4.5
It could be seen that the number of contact gates required for International movements works
out to the same value i.e. 10 (in C configuration).
On the similar grounds, the calculation for domestic gates has been calculated keeping in mind
that currently about 70 % of domestic passengers are moved through contact gates and this
figure is supposed to go up to 85% in design year.
Enplaned Passengers per Gate Approach (Domestic)

Passengers
2014 2721760 19000 5 544400 143.3
2015 3288786 21250 5 657800 154.8
2016 4177941 27000 5 835600 154.7
2018 6105152 32138 6 1025800 190.0

2019 6697352 35062 6 1031400 191.0
2020 7346995 38253 7 1037100 192.1
2021 8059653 40204 7 1082500 200.5
It could be seen that as gate demand is projected based on assumption that enplaned pax per
gate would increase in the similar fashion. However average enplaned passengers per
departure would not increase substantially in near future unless the mix of wide bodied
carriers is increased quite significantly and that too in the given period under consideration.
Thus, the gate demand calculated from Departures per gate is more realistic which is
tabulated below.
_________________________________________________________________________________
Sep 2017 23
Departures per Gate Approach (Domestic)

Passengers
2014 2721760 19000 5 3800 10.4
2015 3288786 21250 5 4250 11.6
2016 4177941 27000 5 5400 14.8
2018 6105152 32138 11 2920 8.0

2019 6697352 35062 11 3070 8.4
2020 7346995 38253 12 3220 8.8
2021 8059653 40204 12 3380 9.3
Thus, the total demand of contact gates for the demand year works out to be 22.
5.1.3. Expansion of the Kerb and Approach ramp
The existing kerb has a length of 220 m and handling capacity of 1100 vehicles /hour in the
departure and 600 vehicles/hour in the arrival. Evaluation of the kerb capacity indicates that
the existing capacity is inadequate to meet the present-day traffic during peak hour. The
proposal for expansion of the kerb is considered essential. To accommodate expansion of the
kerb, widening of the approach ramp becomes a necessity.
The present level of service based on the curb length available and existing traffic mix has
been assessed and tabulated below for both the Arrival and Departure Ramp.
Single Curb Model Present Level of Service (Departures)

Design Hour Peak 15 Minutes Vehicle Peak 15 Min. Vehicle Peak 15 Min. Peak 15 Min.
Demand in as % of Demand Dwell Time Demand in Length Demand Demand

Vehicle Vehicles 0.3 (min.) Minutes (ft) (ft* min.) (ft)
Type
Private 495 148.5 2 297 22 6534 435.6
Vehicles
Taxis 550 165 1.5 247.5 22 5445 363
Buses* 33 9.9 4 39.6 40 1584 105.6
Other 22 6.6 3 19.8 26 514.8 34.32
Total 1100 330 Total 938.52
Existing Curb front 722 ft Existing Capacity Ratio 0.65

Length
Effective Double-Parking 1444 ft Existing Level of Service D

Capacity (LOS)
_________________________________________________________________________________
Sep 2017 24
Single Curb Model Present Level of Service (Arrivals)

Design Peak 15 Vehicle Peak 15 Vehicl Peak 15 Peak 15
Hour Minutes Min. e Min. Min.
Demand in as % of Demand Dwell Demand in Length Demand Demand
Time
Vehicle Type Vehicles 30% (min.) Minutes (ft) (ft* min.) (ft)
Private 480 144 3 432 22 9504 633.6
Vehicles
Taxis 90 27 3 81 22 1782 118.8
Buses* 18 5.4 15 81 40 3240 216
Other 12 3.6 6 21.6 26 561.6 37.44
Total 600 180 Total 1005.84
Existing Curb front Length 722 ft Existing Capacity Ratio 0.70

Effective Double-Parking 1444 ft Existing Level of D
Capacity Service (LOS)
Both the Arrival and Departure Ramps are near saturation and future growth of traffic would
future reduce the LOS to lower level.
The assessment of LOS is also done for the future traffic after additional Ramps for both arrival
and departure. The design peak traffic mix is kept the same while the kerb length has been
doubled after addition of ramp for both Departures and Arrivals. The design capacity for
arrivals is kept 1100 while that for Departures has been increased to 2000 vehicles.
Single Curb Model Future Level of Service (Arrival)

Time
Private 880 264 3 792 22 17424 1161.6
Vehicles
Taxis 165 49.5 3 148.5 22 3267 217.8
Buses* 33 9.9 15 148.5 40 5940 396
Other 22 6.6 6 39.6 26 1029.6 68.64
Total 1100 330 Total 1844.04

Effective Double-Parking 2888 ft Existing Level of C
Single Curb Model Future Level of Service (Departure)

Time
Private 900 270 2 540 22 11880 792
Vehicles
Taxis 1000 300 1.5 450 22 9900 660
_________________________________________________________________________________
Sep 2017 25
Single Curb Model Future Level of Service (Departure)

Time
Buses* 60 18 4 72 40 2880 192
Other 40 12 3 36 26 936 62.4
Total 2000 600 Total 1706.4

Effective Double-Parking 2888 ft Existing Level of C
It should be noted that the Arrival Ramp would be reaching LOS C soon after 2021.
5.1.4. Pier Expansion
The pier expansion is worked out based on the TRB Models keeping in mind that the expansion
if required had to be done in modular templates as the Ultimate Master plan. The calculations
for area required are tabulated below.
PIER AREA CALCULATION

No. of Seats on Design Aircraft 197.6
Load Factor 0.9
No. of Design Passengers 177.84
Percent Seated 0.65

Percent Standing 0.35
Seated Passenger Space Requirement (sq. ft.) 18.3
Standing Passenger Space Requirement (sq. ft.) 12.9
Seated & Standing area (sq. ft.) 2918.354
Allowance for Amenities (Increase) 0.05
High Utilization Factor (Increase) 0.2
Hold room Sharing Factor (Decrease) 0.05
Adjusted Seated and Standing Area (sq. ft.) 3490
Podium Width/Position (ft) 10

Depth of Podium to back wall (ft) 10
Podium Queue Depth (ft) 15
Area per Podium Position (sq. ft.) 250
Number of Podium Positions 34
Total Podium and Queue Area (sq. ft.) 8500
Boarding/ Egress Corridor Width (ft) 6
Depth of Hold room (ft) 66
Boarding/ Egress Corridor per Bridge (sq. ft.) 396
Number of Bridges/ Doors 2
_________________________________________________________________________________
Sep 2017 26
Boarding Corridor Area (sq. ft.) 792
Total Hold room Area (sq. ft.) per gate 12800

Total Circulation Areas (sq. ft.) per gate (equals Hold room Area) 12800
Total Area for Amenities (sq. ft.) per gate (Half of Hold room area) 6400
Total Area of Concourse (sq. ft.) per gate 32000
Total Area of Concourse (sq. ft.) 1088000
Total Area of Concourse (sq. m) 101130
Present Area of Concourse 70000 sqm

Area of Concourse required after pier
expansion 101103 sqm
Area to be extended 31103 sqm
Area per modular pier 14806 sqm
Number of modular pier expansion required 2.100702
Say 3
Therefore, the expansion on East-side pier (addl. Space of 34,507 sqm) to accommodate 12
contact stands and West-side pier expansion (addl. space of 16,512 sqm) to accommodate 5
contact stands is justified
5.1.5. Expansion of Apron
The airport at present has 42 stands of which 12 are contact stands (6 + 3x2).
To cater to increased traffic and requirements of night parking, the total stand requirement
for the year 2020-21 is proposed to be 52 apron stands. Hence, an additional requirement of
10 new apron stands have been proposed.
As per ICAO guidelines, the required number of aircraft stands at passenger terminal may be
estimated by the following formula:
S = ∑ (Ti/60 x Ni) + α where S = required number of aircraft stands
Ti = gate occupancy time in minutes of aircraft group i
N i = Number of arriving aircraft group i during peak hour
α = number of extra aircraft stands as spare
Considering total peak hour ATM of 34 in the design year with total peak hour arrival of 14
domestic and 3 international aircraft and a turnaround time of 45 minutes for domestic flight
and 120 minutes for international flight the approximate aircraft stand requirement for the
design year works out as under:
Number of domestic aircraft stand
S = 45/60 x 14 + 1 = 12 stands
_________________________________________________________________________________
Sep 2017 27
Number of international aircraft stand
S = 120/60 x 3 + 1 = 7 stands
In addition, there is night parking requirement of 40 projected by GHIAL based on request by

various airlines.
Thus, the demand for total aircraft stand requirement of 52 projected by GHIAL is considered
reasonable as some of the contact gates will also utilized for night parking.
Area Requirement
The approximate area required for remote stands for Code ‘C’ type of aircraft is 3700 sqm per
aircraft. Thus, the total area of additional stands works to 37,000 sqm. However, keeping the
expansion of apron in symmetry with the existing configuration and as proposed in the Apron
development plan drawing GADL/PTB/2017/A/001 dt. 26.04.2017 submitted by HIAL, the
pavement area of rigid pavement works out to 46,000 sqm as against 72,450 sqm proposed
and the remaining area of associated flexible pavement for taxiways & vehicle movement area
works out to 72,734 sqm against 46,284 sqm.
Proposed expansion of apron
HIAL vide their additional submissions have submitted apron development plan showing the
area break up of apron, taxiway & road pavement. It has been observed that an area of 15,025
sqm is earmarked for apron in between the HOS roads. The plan does not show planned
aircraft parking in this area. Part of this area was earlier earmarked for GSE in the initial
submission made by HIAL. The area between HOS roads earmarked as apron is not conducive
for parking of narrow/wide bodied aircraft having wing span more than 25m. The area for
rigid pavement for apron and flexible pavement for taxiway movement has accordingly been
considered as 46,000 sqm and 72,734 sqm respectively.
_________________________________________________________________________________
Sep 2017 28
5.2. The Capital Cost Proposal
5.2.1. General
The capital cost proposal has been prepared by HIAL by adopting the following methodology:
 Detailed rate analysis has been submitted by the firm for some of the items based on
present market rates
 For some of the items, rates of the contract executed in 2005 has been adopted duly
applying escalation based on the indices published by Construction Industry
Development Council.
 In the analysis of rates, the following charges have been adopted
o Water charges @ 5% for items of building works
o Water charges @ 1% for items of pavement works
o Overhead Charges @ 10%
o Contractor’s profit @ 10%
o Working in operational area @ 5% for some items and 10% for some items of
work
 Cost of equipment works based on vendor quotations
 Escalation @ 5% per annum has been adopted on item rates which are based on
contract executed in 2005 and market rates/quotations obtained in 2015
 Escalation has been adopted for the equipment and finishing items till 2021 i.e. till the
anticipated completion of the project
5.2.2. Expansion of the Terminal Building
An amount of Rs. 1449.83 Crores is catered in the proposal for expansion of the passenger
terminal building which includes Civil and Finishes, MEP Systems, Airport Systems and IT
systems which constitutes to 65% of the total capital cost proposal.
The break-up of the cost is as below:
Civil and Finishes - Rs. 783.62 Crores
MEP Systems - Rs. 164.21 Crores
Airport Systems - Rs. 453.11 Crores
IT systems - Rs. 48.89 Crores
Civil and Finishes
GHIAL has submitted along with their proposal the analysis in respect of the items for arriving
at the cost. The details provided for major items has been scrutinized and the observations
are as under:
a) For the Civil & Finishing works, GHIAL has adopted the rates of the previous contract
executed in 2005 and updated the cost by adopting escalation @ 5% per annum. In
support of the claim for escalation, GHIAL has submitted the indices published by
Construction Industry Development Council (CIDC). It has been observed that the CAGR
of price escalation for the period from Oct. 2007 to September 2015 works out to 4.45%.
_________________________________________________________________________________
Sep 2017 29
Further, the escalation has been re-calculated based on the indices available up to
September 2016 which comes out to 4.03%. Accordingly, the escalation adopted has been
modified. HIAL vide its further submission, submitted the calculation of cost indices and
requested for review. The calculations have been reviewed and the proposed rate revision
of 4.03% by RITES is found to be in order.
b) The market rate of steel reinforcement has been taken on a higher side and the same has
been modified with the prevalent market rates.
c) The rate analysis submitted by the firm indicate inclusion of 10% towards overheads,10%
towards profit and 5% towards water charges. Overheads & profit @ 15% is generally
allowed by Government Departments like CPWD. Hence the claim of 20% towards the
same needs to be restricted to 15%. HIAL vide its further submission requested for review
in consideration of operational constraints of working in operational airport. This aspect
has already been considered separately where applicable and 5% has already been
allowed towards the same.
d) The water charges are taken at 5% in some of the items whereas the permissible % as per
CPWD norms is 1%. Hence the water charge has been revised accordingly. HIAL vide its
further submissions, submitted copies of water bills to elaborate the rationale behind the
higher water charges taken for Hyderabad Airport. However, water charges @ 1% is
considered adequate.
Based on the above observations, the cost of the Civil and Finishes has been reworked to
Rs. 709.98 Crores as per the details enclosed as against Rs. 783.62 Crores.
MEP Systems
A total cost of Rs. 125.18 crores has been proposed in the estimate towards HVAC and
Electrical works which works out to 15.97% of the estimated cost of civil works. These costs
have been arrived at based on vendor quotations. As per practice followed by CPWD, 15% of
the basic cost is allowed in the estimates towards internal electrification excluding air-
conditioning. Hence the estimated cost of Rs. 125.18 Crores is considered reasonable.
Airport Systems
A total cost of Rs. 453.11 Crores is catered towards airport systems including Passenger
Boarding Bridges, Screening system, Baggage Handling System, People Movers (Elevators,
Escalators and Travellators).
The Baggage Handling System (BHS) including baggage screening system is estimated to cost
Rs. 217.79 Crores. The passenger boarding bridge and passenger screening systems put
together cost 112.48 Crores. The costs are based on the vendor quotations duly escalated till
the completion period.
The cost of the baggage handling system is high due to the reason that the baggage processing
functions are distributed over 5 levels of the building, i.e., check in process at Level F and
baggage make up at Level C, the conveyors laid from Level F and spiralled down to Level C+
and further laid up to baggage make up area and to Level 4 room. The arrival baggage is
handled from baggage break up area located in level C and transported to Level D (Baggage
reclaim hall) through conveyors passing through Level C+. Further, baggage screening system
has also been proposed. The additional length of conveyor proposed is approx. 4000 m. The
vendor has supplied a quotation for Rs. 156.5 Cr. in July 2015 and the same has been escalated
_________________________________________________________________________________
Sep 2017 30
till the proposed completion period i.e. till 2021. In the absence of a detailed work plans, in-
depth analysis and verification of the costs for such special equipment works is not feasible.
The proposed cost of people mover (escalator, elevator, travellator etc.) is Rs. 122.84 Crores
and the cost of passenger boarding bridge is Rs. 67.29 Crores.
The estimated cost of proposed equipment is supported by quotation from single vendor for
major items such as baggage conveyors, people movers, passenger boarding bridges etc.
obtained in 2015-16 duly escalated for the year 2020-21. Most likely, the cost of equipment
proposed is likely to cost less when the open bids are invited on a competitive basis. Further,
the cost escalation on the equipment is not likely to be at par with other construction
materials. It will therefore be prudential to consider the basic cost of equipment without
application of any escalation. Thus, the revised cost of airport systems works out to Rs.355
Cr.
IT Systems
Rs. 48.89 crores has been catered towards IT systems which is 6.5% of the cost of civil and
finishing works. This is considered reasonable in comparison with the provisions at NSCBI
Terminal Building, Kolkata in the year 2008 – 2010.
Thus, the revised cost of Passenger Terminal Building works out as below:
Civil and Finishes - Rs. 709.98 Cr

MEP Systems - Rs. 125.18 Cr.
Airport System - Rs. 355.00 Cr.
IT Systems - Rs. 48.89 Cr.
Total - Rs. 1239.05 Cr
5.2.3. Expansion of the Kerb & Approach Ramp
An amount of Rs. 108.50 Crores is catered in the proposal for expansion of the upper and
lower forecourt and connecting roads. This constitutes approx. 5% of the total cost proposal.
Based on the observations mentioned at para 5.2.2, the cost of expansion of the kerb &
approach ramp stands revised to Rs. 98.83 Cr.
5.2.4. Expansion of Apron
An amount of Rs.129.38 Crore is catered in the proposal for expansion of apron and associated
works. The major constituents include:
Rigid Pavement for Apron - 51.07 Cr
Bituminous Pavements for taxiways 16.66 Cr
Drain - 12.98 Cr
Fixed Electric Ground Power/GPU - 10.82 Cr
Visual Docking Guidance System - 7.41 Cr
Pre-conditioned Air Unit - 15.66 Cr

_________________________________________________________________________________
Sep 2017 31
Others - 14.76 Cr
The existing apron is provided with the following pavement section:
410 mm thick Pavement Quality Concrete laid over 200 mm thick dry lean concrete, 250 mm
sub-base of select fill material having CBR 12% at 98% MMDD and compacted sub-grade.
It has been proposed by GHIAL to provide 350 – 400 mm thick PQC over 170 mm thick dry
lean concrete with drainage layer of 400 mm thick over sub-grade.
The taxiway is proposed to comprise 110 mm thick bituminous concrete over 125 mm Dense
Bituminous Macadam, 150 mm WMM, 200 mm GSB and compacted subgrade.
The pavement section proposed for rigid and flexible pavements are similar to the existing
pavement.
The total area proposed for expansion is 118,734 including apron and associated taxiway
pavements. The overall cost per sqm works out to Rs. 10,896. This is inclusive of all other
associated works such as high mast lighting, drain, fuel hydrant, boundary fence etc.
The cost of rigid pavement for apron is proposed at Rs. 7,050/sqm and the cost of bituminous
pavement for taxiways at Rs. 3,600/sqm. The average cost of aircraft movement area
(pavements) works to Rs. 67.74 Cores i.e. Rs. 5,705/sqm as against AERA norms of Rs.
4,700/sqm.
For arriving at the cost, GHIAL has adopted market rates prevalent in 2015 duly escalated till
the anticipated completion. The rates analysis submitted by the firm indicate inclusion of 10%
towards overheads, 10% towards profit and 10% towards working in operational area.
Overheads & profit @ 15% is generally allowed by Government Departments like CPWD.
Hence the claim of 20% towards the same needs to be restricted to 15%.
Further, the claim for 10% extra for working in operational area does not justify as the
substantial cost goes towards the cost of materials. However, in consideration of the fact that
working in operational & restricted area requires extra efforts and additional safety measures
to be undertaken by the contractor. Hence the claim on this account may be restricted to 5%
Taking the above into cognizance, the rate of Rs. 7,050 per sqm and Rs. 3,600 per sqm for rigid
and flexible pavement will get reduced to Rs. 6,508 per sqm and Rs. 3,323 per sqm approx.
Accordingly, the cost of pavement works stands revised as under:
Rigid pavement 46,000 sqm @ 6,508 = 29.94 Cr
Bituminous pavement 72,734 sqm @ 3,323 = 24.17 Cr
Total = 54.11 Cr
Similarly, the cost of drainage stands revised to Rs. 11.98 Cr and equipment & other works to
Rs. 44.91 Cr.
Thus, the total cost of pavement works heads stands revised as under:
Rigid pavement for Apron - Rs. 29.94 Cr

Bituminous Pavements for taxiways - Rs. 24.17 Cr
_________________________________________________________________________________
Sep 2017 32
Drain - Rs. 11.98 Cr

Equipment & others - Rs. 44.91 Cr
Total - Rs. 111 Cr
5.2.5. Others
The capital cost proposal submitted by HIAL comprise the following provisions:
5.2.5.1. Preliminaries (Construction)
An amount of Rs. 34.00 crores is provisioned in the capital cost proposal towards preliminaries
@ 2% of the estimated cost of works. This is catered towards provision of barricading to the
work area, scaffolding for removal of existing glass façade etc., Operation readiness and
Airport Transfer, Labour camp for 4000 labour force, dust arresters, housekeeping, traffic
management systems, Temporary signage, temporary roads & access gates etc.
These are provisional sums and generally vary between 1% to 5% depending on the total
estimated cost of works. As per prevalent practices in India, these are in-built into the unit
rates to be quoted by the bidder for various work items or measured and paid separately. In
the global tenders, the preliminary items are costed separately. It has been observed that in
the earlier contract executed between L & T and China State, the cost of preliminary items
worked out to 11.72% of the total cost of Rs.262.87 Crores. Thus, the provision of 2% is
considered reasonable.
5.2.5.2. Insurance & Permits
An amount of Rs. 20.00 crores is provisioned in the capital cost proposal @ approx. 1.5% of
the estimated cost of works towards insurance & permits which include CAR policy for entire
project cost, permits, licenses, inspection fee, certifications viz. Airport Certification, ICAO
validation, DGCA inspection, MIDT & OAG Data, PESO, PCA/ECA and all applicable statutory
fee.
5.2.5.3. Design Development
An amount of Rs. 50.00 crores is provisioned in the capital cost proposal @ 3% of the
estimated cost of works towards design development.
5.2.5.4. Supervision
An amount of Rs. 92.20 crores is provisioned in the capital cost proposal @ 5.5% of the
estimated cost of works towards project management consultancy.
The quotes received for Design and Project Management consultancy in some of the recently
invited bids by Airports Authority of India for expansion of terminal buildings at major airports
are tabulated as under:
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Sep 2017 33
Airport Est. Cost Area Appx. Cost PMC fee including Time
per sqm design and schedule
(Rs. (Sqm) excl.
construction
Crores) basement (Rs.) (deign +
supervision as per
constn.)
Quote received
through open bid on
QCBS
Jaipur 9+36
Airport 1177.74 125000 94,219 3.47% months
Chennai 9+36
Airport 2100 168800 1,24,407 2.79% months
Guwahati 9+36
Airport 913 77500 1,17,806 3.90% months
Trichy 9+36
Airport 764 60723 1,25,817 6.40% months
Lucknow 9+36
Airport 878.25 100000 87,825 6.94% months
HIAL vide its further submissions, submitted the details of design works already awarded
amounting to Rs.37.07 Crores supported with copies of work orders and planned for award
amounting to Rs.11.76 Crores totaling to Rs.48.83 Crores.
Towards the PMC, HIAL has indicated to deploy approx. 36-72 expert manpower for the period
commencing 2017-2021 (5 years) totaling to 3700 – 3800 man-months including planning
period from Sept 14 -16. Towards supervision, Rs. 92.20 crores is catered in the estimate. HIAL
has also stated that historically they have incurred 11.29% of the base cost on account of
project management and consultancies.
There is a need to restraint the cost incurred on design and project management. In
consideration of the similar works taken up by AAI through open competitive bidding, the fee
of 8.5% considered for design development and supervision by GHIAL appears to be on the
higher side.
In consideration of the fee quote tabulated above, a fee of 5% is considered reasonable for
design development and PMC for this magnitude of work.
5.2.5.5. Contingencies
A provision of 6% of the estimated cost is catered towards contingencies, amounting to

Rs.105.10 Crores.
Generally, contingencies for projects of this magnitude are catered at 3% of the estimated
cost.
_________________________________________________________________________________
Sep 2017 34
HIAL vide its further submissions, submitted extracts from project investment file & tariff
order published by AERA in respect of Cochin, RBI guidelines, Bureau of Indian Standard, and
technical audit report of MIAL in support of their claim for Contingencies.
The same have been studied and it has been observed that the amount of deviation of cost
from the initial estimate and revised cost is quoted as reasons for provisions towards
contingencies. Although, the details of the cost deviations are not explicit, predominantly it
appears on account of increase in escalation of cost. It may be clarified that in the proposed
cost estimate submitted by HIAL, the contingencies on account of price escalation is already
catered and in built into the rates till the date of completion of work. The provision of
contingencies @ 3% is towards physical contingencies including any modification to the scope
of work and unforeseen items. The draft BIS quoted by HIAL also indicate a range of 3 to 5%.
Considering the magnitude of the project, the provision of 3% towards contingencies is
considered adequate as presently followed by the government organizations such as AAI and
CPWD.
5.2.5.6. Interest during construction
An amount of Rs.235.26 Crores towards interest during construction. This aspect may be
reviewed by AERA.
5.3. Comparison of Basic Cost
An attempt has been made to compare the cost of the new terminal building constructed at
Cochin and the proposed expansion of existing terminal building at Hyderabad as below:
As desired by AERA, a field visit was undertaken to Cochin by RITES expert on 20 th Sept 2017
to understand the design & specifications adopted by Cochin International Airport for the
construction of new international terminal building. Based on the data collected, the
difference in the construction cost between the new international passenger terminal
buildings at Cochin and the proposed expansion at Hyderabad has been broadly analyzed and
the major reasons are brought out as under:
S.No Criteria Cochin Other Terminals

1 Facade Glazing Combination of Single 60-85% double Glazed
& Double Glazed for paneling
35 to 40% area
2 Internal Wall Wooden panel with ACP wall cladding with
finishes/claddings Laminates perforations
3 Roofing Sheeting 3 Layered System 5 Layered System with
system without Skylights Skylights for natural lighting
(Kingspan)
4 False Ceiling Hunter Douglas Premium imported false ceiling
systems
5 Sanitary fixtures & Local Makes Premium imported sanitary
Fittings ware
6 Flooring in Vitrified Tiles Granite Flooring
Passenger
Movement areas
_________________________________________________________________________________
Sep 2017 35
S.No Criteria Cochin Other Terminals

7 Passenger Loading Non-Glazed Mostly Glazed
Bridges
8 Passenger Seating Wooden Sofas with Imported PU Based seating
system cushion
9 No of floors levels of Four Levels Six or more for other terminals
the Terminal
10 Foundation of Isolated footing
Terminal building foundations on laterite
soil
11 Tendering Process Bid process adopted Due to invitation of bids from
by CIAL appears to be selective short-listed bidders,
better than other the competition gets restricted
airport operators. resulting in substantial higher
Based on the details bids than the estimate. The
collected, it has been concessionaire should ensure
observed that there is adequate/healthy competition
very healthy in order to get reasonable bids.
competition and as It is also observed that Terminal
such the bid received cost (per sqm) executed by AAI
are lower than the like Chennai, Kolkata of similar
estimated cost. magnitude is lower than Delhi,
Mumbai, Hyderabad and
Bangalore.
12 Equipment The cost of Airport The cost of Airport systems is
systems like PLB, much higher.
Escalators, Lifts,
Travellators, VGDS,
etc. is lesser.
13 Terminal Separate Domestic Integrated Terminal
and International
14 ASQ Rating Lower Higher
Further, it has also been observed that the area of the new international terminal building at
Cochin is appx. 1,40,000 sqm and not 1,50,000 sqm as claimed.
A sub-head wise broad comparison of cost of the terminal buildings at Cochin, terminal
constructed at Kolkata by AAI, proposed terminal expansion at Hyderabad is given below.
Cost Difference from Cochin
Cochin Hyderabad Kolkata (Rs./Sqm)
Cost Rs. Per Cost Per Cost Banga Hydera-
Sub Head Cr % sqm Rs.Cr % sqm Rs. Cr % Per sqm -lore bad Kolkata
Civil Works 401.47 47% 26765 335.43 23% 32566 957.16 43% 48173
Spl finishes 70.26 8% 4684 191.6 13% 18602 56 3% 2818

External
façade 47.98 6% 3199 117.12 8% 11371 167.12 8% 8411
Roofing
system Incl. Incl. 104.54 7% 10150 161.76 7% 8141 37,983 38,041 32,896
HVAC 8100 56.64 4% 5499 144.88 7% 7292

Electrical
system 0 74.38 5% 7221 193.54 9% 9741
Plumbing &
Drainage 121.5 0 17.18 1% 1668 71.74 3% 3611
_________________________________________________________________________________
Sep 2017 36
Cost Difference from Cochin

Cochin Hyderabad Kolkata (Rs./Sqm)
Cost Rs. Per Cost Per Cost Banga Hydera-
Sub Head Cr % sqm Rs.Cr % sqm Rs. Cr % Per sqm -lore bad Kolkata
Fire fighting
system 0 10.18 1% 988 27.8 1% 1399
Fire 14.3
detection 1% 0 5.83 0% 566 0% 0 9,880 7,843 13,942
Vertical &
horizontal
transport 0 122.84 8% 11926 119.48 5% 6013
PTB furniture 0 28.42 2% 2759 0% 0

Airport
systems 185.1 22% 12340 379.16 26% 36812 301.93 14% 15196
Special
works 22.85 3% 1523 6.5 0% 631 3.31 0% 167 15,250 38,265 7,512
100 100 100
Total Cost 849 % 1,450 % 2,205 %
Area 150000 103000 198692

Cost
Rs./sqm
56,611 140,759 110,962 63,113 84,149 54,351
It can be seen from the above that the major difference is due to the exterior and interior
special finishes and the cost of Airports systems including baggage conveyor, escalator,
travellator etc. These mainly depend on the design of the terminal building and the type of
building structure i.e. whether RCC or steel structure and the number of floors. A detailed
comparison can be undertaken only when the detailed drawings and BoQ are available.
5.4. Construction Schedule
GHIAL has submitted the overall implementation schedule with expected date of
commencement as March 16 and completion in April 2020 i.e. spanning over a period of 4
years. The construction period starting July 2017 to April 2020.
The time for construction stipulated by AAI in some of the tenders for airport terminal building
projects for Project Management Consultancy including design and supervision is 9 months
planning & design and 36 months for construction.
Hence the time schedule proposed by GHIAL is considered to be reasonable.
_________________________________________________________________________________
Sep 2017 37
6. FINDINGS
6.1 Findings
The findings of the exercise with reference to scope are summarized as under:
a) To examine the proposal of the airport and assess the need for the proposed project and
its capacity/scope with reference to Passenger growth/Cargo Volumes/Air Traffic
Movement and also to suggest cost effective alternatives
The proposal for expansion of the terminal building, apron and approach ramps submitted
by GHIAL is justified in view of the traffic trend and the growth witnessed in the recent
years at Hyderabad airport as discussed in Chapter 3.
b) To examine the building standards and designs proposed by the airport operator in line
with IMG norms/IATA/ICAO norms
The airport was commissioned in 2008, i.e. prior to issue of IMG norms. Hence, the area
standards recommended by IMG did not apply to the existing terminal building. However,
the total area of terminal building including the proposed expansion is within the norms
prescribed as discussed in Chapter 5. (para 5.1.2)
c) To analyze the reasonableness of the proposed cost with reference to the tentative
ceiling decided by Authority vide order no. 7 dated 13/06/2016 based on the details of
the rates and quantity as per government/industry approved norms and advise the
Authority on the reasonableness of the costs
A macro level examination of the capital cost estimate submitted by GHIAL has been
conducted based on the information provided by GHIAL and engineering in practice. The
revision to total capital cost is recommended as under:
SN Item Capital Cost as Revision in Capital

proposed by Cost recommended
GHIAL (in Rs. (in Rs. Cr.)
Crore)
1 Expansion of the Terminal Building 1449.83 1239.05
2 Expansion of the Kerb & Approach 108.50 98.83
ramp
3 Expansion of Apron 129.38 111.00
Sub-Total 1687.71 1448.88

4 Preliminaries @ 2% 34.00 28.98
5 Insurance and Permits 20.00 20.00
6 Design Development & PMC 142.20 72.44
7 Contingencies 105.10 43.47
1989.01 1613.77
An amount of Rs. 235.26 Cr proposed towards Interest during construction may be

reviewed by AERA.
_________________________________________________________________________________
Sep 2017 38
d) To review designs and specifications proposed in case the costs are assessed to be
excessive where the Projects are already in progress or the contracts are already
awarded. Further to examine whether proper procedures have been followed in the
award of the work.
The proposal is for extension of the existing terminal building and hence the specifications
of the proposed terminal building have to match with the existing building to provide
uniformity. The works are yet to be undertaken GHIAL.
e) To review and justify the reasonableness of time schedule of completion of work of

proposed by HIAL
The time schedule proposed by GHIAL is considered adequate and reasonable.
***
_________________________________________________________________________________
Sep 2017 39

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9/25/2017

Analysis of Capital Expenditure

OM SRI GANESHAYA NAMAH

5.2.5.6. Interest during construction ............................................................................................. 35

AERA Airports Economic Regulatory Authority of India

Nature of Agreement - Concession agreement for Development, Construction, Operation and

The shareholding pattern of GMR Hyderabad Airport Limited as on 31.03.2016 is as under:

GMR Airports Limited, Holding Company - 63%

1.2. Scope of Services

The scope of services assigned to RITES include

1.3. The Study Team

1.4. Data Collection

The following data has been collected and studied:

 Calculation of price escalation based on CIDC price index

AERA vide letter No. AERA/20010/Normative Approach/2014-15/Vol- II/pt.file/13061 dt.

The expansion proposal by GHIAL is summarized as under:

Description Present (2015) Proposed (2021)

Description Present (2015) Proposed (2021)

2.2. Capital Cost Proposal

SN Description Area (sqm) Est. Cost (Rs. Crores)

Cost Distribution of Capital Expenditure

Passenger Terminal Building

 Airport presently has passenger capacity of 12 MPPA

3.2. Air Traffic Forecast by ICF Limited (2015)

CAGR Dom Intl. Total

CAGR Dom Intl. Cargo Total

Passenger Traffic (2009-2017)

Intl. Dom Total

As per actual, the airport handled 3,370,061 international passengers and

Aircraft Movement (2009-2017)

Intl. Dom Total

It can therefore be concluded that passenger traffic of 20 million considered by

A Growth Rate for Traffic Projections

B Target year for Capacity Creation (Design Year)

Following norms could be adopted for capacity creation:

C Peak Hour Projections

SL.No Traffic (in mppa) Ratio for Ratios for Domestic

D Level of Services in Target Year

E Unit Area Norms

SL.No Nature of Terminal Area Norm –

F Unit Cost of Construction

G Airports developed through Public Private Partnerships

4.2. AERA Order No. 07/2016-17

In the matter of Normative Approach to Building blocks in economic regulation of major

grade level) is approved as a reasonable benchmark for evaluating capital costs to be

5. EVALUATION OF THE PROPOSAL

5.1.1. Expansion of the Terminal Building

SN Project Proposed Addition to Built-up Area

5.1.2. Capacity Calculation of Passenger Terminal Building

Existing Passenger Terminal Building

Existing Peak Hour Traffic (Annual 12MPPA)

Existing Built-up Area = 117,339 Sqm

Proposed Expansion to Passenger Terminal Building

Projected Peak Hour Traffic (2020-21)

Total Peak Hour Traffic in Design Year (2021)

Expanded Area of Passenger Terminal Building = 2,20,339 Sqm

n = number of gates required

v = design hour flow for departures or arrivals (aircraft / hour)

t = mean stand occupancy (hour)

u = utilization factor 0.6 – 0.8

n = 17 x 0.75 /0.6 = 21.25 say 22

Enplaned Passengers per Gate Approach (International)

2018 1962202 12973 8 237600 151.2

Departures per Gate Approach (International)