India's aviation ministry has denied accusations that it had given undue benefits to the Delhi International Airport Ltd (DIAL) - a joint venture controlled by GMR Group of Hyderabad.
The Comptroller and Auditor General (CAG) said in its report that the DIAL was given a licence to exploit 240 acres of prime land surrounding the New Delhi airport for 56 years a fee that was tenth of the land's value.
The state auditor said the license was given for just Rs 2,450, while the land actually valued Rs 24,000 crore.
The DIAL itself calculated that the land would potentially generate Rs. 163,557 crore in revenues. With its 54 per cent stake in the joint venture, DIAL alone will gain Rs 88,337 crore, which represents a return of 6,600 per cent on its investment of Rs 1,323 crore.
But, DIAL argued that it hadn't received any undue benefits from the government in the bidding process, and that the whole process was competitive and transparent.
The aviation ministry said, "The calculation of presumptive gain from the commercial use of land at Delhi Airport is totally erroneous..."
The ministry added that all decisions about the capital's international airport were taken with the clearance of the cabinet and that all airport assets created by DIAL would be returned to AAI as per deal at the end of the concession period.
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