History : Realizing phase 1

It took almost a decade from the stage of land allocation to acquisition to signing of the shareholder agreements in January 2002 and finally the start of construction. By the time BIAL had to negotiate the legal framework, the Government of India had already planned to privatize other airports. BIAL being the first private airport in India had to set the right precedence for the other private airports and therefore all agreements like the concession agreement, CNS ATM agreement, etc. had to be finalized carefully.

The main observation during the formation of the legal framework was the unprecedented growth the aviation industry faced. India’s economy experienced a remarkable growth trend and Karnataka’s growth levels were seen even slightly above the national level mainly owing to the positive development of Bangalore as the Silicon Valley of India, and also the strong growth of other sectors like pharmaceuticals and biotechnology. At the same time the reform oriented Government of India liberalized the civil aviation sector by allowing domestic players to come up with more private airlines and sanctioning more foreign airlines to fly into India.

These two factors, growth of economy and civil aviation liberalization led to a significantly increased demand for air travel and resulted in soaring traffic figures. BIAL now had to verify the airport capacity and take necessary steps to make the airport practical for years to come. 

When the project was designed initially, BIAL had anticipated a traffic volume in the first year of the operation that was already reached by the time the construction started. The big challenge was to significantly increase the project which was already under construction without jeopardizing the initial airport opening date. The redesign process along with the formal approval took more than 9 months and by the time the increased project was approved, half of the construction was complete. The first phase of the airport opened for operations on May 24, 2008.