Adani Airport Holdings Limited (AAHL) has put forward a USD $ 1.84 billion PPP bid towards the improvement and expansion of JKIA (Jomo Kenyatta International Airport), a deal that has stirred controversy and attracted widespread online protests in Kenya in 2024. AAHL is an India based airport development company incorporated in 2019 as a subsidiary of Adani Enterprises Ltd. Adani Enterprises Ltd is the main company of the Adani Group, founded in 1988.
Who are Adani and how would this JKIA PPP project be undertaken if their bid succeeds? Learn more below.
Jomo Kenyatta International Airport (JKIA)
JKIA has been Kenya’s biggest airport facility for over four decades, serving as a key hub for both domestic and international flights. Since the corporation was established in 1991, JKIA and its operations have been under the management of Kenya Airports Authority (KAA). KAA is the state corporation responsible for the development, maintenance, and management of all public airports and airstrips in Kenya.
Notwithstanding, the facility and airport operator have, in recent years, severally been on the news for failing the Super Metro masterclass on efficiency and accountability. In May 2024 during the heavy rains across Nairobi, passengers at the airport were forced to brave poor infrastructure. JKIA has also been grappling with capacity issues, primarily because it was designed for fewer passengers and less traffic.
In trying to understand why the relevant agency has not been successfully foreseeing and working to prevent such challenges, several additional issues emerge.
Labour disputes between airport staff and the management have contributed to several disruptions of operations in the past. At the height of such disputes airport staff often resort to striking, paralyzing activities at the facility. As a result, certain good interventions have failed in the past. This reveals shortcomings in management systems, communication, and contingency planning by KAA. Some stakeholders speculate that such inadequacies extend up the authority’s managerial hierarchy, hinting at incompetence of certain top officials. Thus making it unattainable to keep airport operations and management efficient and up to global standards.
Adani Airport Holdings Limited in India
Reports indicate that AAHL is the leading airport infrastructure company in India. Their official group and company websites state that they account for up to 25% of passenger footfalls and about 33% of air cargo traffic in India. The company’s airport business is that of bidding for strategic long-term concession (PPP) agreements for the development, operation, and management of airports seeking reorganization. This includes airports facing challenges such as:
- Infrastructure and capacity issues
- Labour disputes
- Security challenges
- Corruption and administrative inefficiencies
- Capital for expansion issues
Adani currently has such concession agreements with India’s airport authorities for six airports. These include:
- Jaipur International Airport
- Chaudhary Charan Singh International Airport, Lucknow
- Sardar Vallabhbhai Patel International Airport, Ahmedabad
- Mangaluru International Airport
- Lokpriya Gopinath Bordoloi International Airport, Guwahati
- Thiruvananthapuram International Airport
These agreements typically last for around 30 years, during which Adani is responsible for the development, operation, and maintenance of airport facilities.
In Adani’s concession bid for Jomo Kenyatta International Airport, they seek to commit approximately USD $1.85 billion FDI. This is to be used to upgrade airport infrastructure, expand facilities, and improve operational efficiency. They will in return generate revenue from landing fees, passenger service charges, retail, advertising, and city side real estate development to recover their principle and interest within the contract period.
Super Metro Airport Shuttles
With such a significant investment in infrastructure, a desirable record of operational and management efficiency, and improved revenue collection for JKIA, the facility and all stakeholders undoubtedly stand to benefit. The controversies surrounding Adani’s international record and name is another matter altogether. It would require a very necessary and costly investigation to uncover just how much of it is politics and how much is real and should be concerning to Kenyans.
The government and numerous private stakeholders have promised to conduct due diligence to this effect and reports will be published.
There might also be job losses for some airport staff and KAA officials during such reorganization. Hopefully this will only be merit based to weed out inefficiencies at the facility and authority. If the current government which has come out through the Ministry of Roads and Transport in strong support of Adani succeeds, we stand to witness if this will place JKIA on the path to becoming Africa’s leading airport.
Super Metro bus transport Company and Sacco have indeed demonstrated that Kenyans will reward systems that work.
Currently, it is one of the most efficiently run commuter Saccos in the country. They have continued to expand from their flagship Nairobi-Juja-Thika routes and are now dominating many routes.
Super Metro recently introduced an Airport Shuttle route from JKIA to Nairobi CBD at very affordable rates, which can be booked online on their website.
Do you support or reject the government’s proposed concession of JKIA to Adani Airport Holdings Limited?
Please share your stand and reasons with City Digest in the comments below.