Kiran Kumar Grandhi, managing director of Hyderabad International Airport Ltd, told a news conference in Hyderabad today that despite the fact under the pact they have to achieve the financial closure of the project in 12 months, it would be done in half the period.

The airport to be built on private-public partnership basis, would be jointly promoted by GMR Group, a big infrastructure company, Malaysia Airport Holdings Berhad, which runs all the commercial airports in Malaysia, the Government of Andhra Pradesh and the Government of India. While the two governments will have 26% equity in the project, GMR Group will have 63% and MAHB11% equity.

Grandhi said the first phase of the airport, with a capacity of five million passengers, will become functional in the second quarter of 2008. The unique feature of this airport, to come up on an area of 5,400 acres, include a separate terminal for the low cost airlines, and an airport village to meet all the requirements of the passengers as well as the other visitors.

Grandhi said the airport, to be located at Shamshabad, 20 km away from Hyderabad, will have the most modern and state-of-the-art facilities in terms of infrastructure as well as technology. The ultimate projected capacity of the airport, when the second phase is also completed by 2029 will reach 20 million passengers per annum, he said.

"It will take 7-8 years, about five million passengers and about 40,000 to 50,000 flights per annum to reach the breakeven point for the new airport", Grandhi said.

The runway will be 4,260 meters long and 60 meters wide, enabling the wide bodied aircraft including 747 and A380s with more than 500 passengers to land and take off from this airport.

Under the concession agreement signed in the presence of Prime Ministers of India and Malaysia Dr Manmohan Singh and Abdullah Badawi, the airport will have to pay 4% of the gross revenue to the government of India as the fee for the right of operating the airport.

On the other hand, the Government of India has agreed not to allow any other international or domestic airport within 150 kms of the new airport for 25 years from commercial operation date. The present airport in Hyderabad will be closed coinciding with the opening of the new airport. The present airport is handling 2.2 million passengers per annum.

The Hyderabad International Airport Ltd, with a majority equity from Rs 2500 crore GMR Group, will design, build, finance operate and maintain the airport and it will have concession period of 60 years. It will have roads connecting two different highways in two different directions, the Hyderabad-Bangalore National Highway No. 7 on one side and the Hyderabad-Srisailam state highway on the other. It will be the only second private airport to come up in India after Kerala.