Indian billionaire eyes Nairobi airport

Photo credit: Amit Jain

Adani Airport Holdings, an airport operator controlled by Indian billionaire Gautam Adani, has submitted a formal proposal to invest in Nairobi’s Jomo Kenyatta International Airport (JKIA). The company, which manages seven airports in India, aims to build a new passenger terminal, a second runway, and refurbish existing facilities. According to the proposal, an estimated US$1.85bn is needed to address challenges at the airport, with US$830m required in the first five years of the upgrade project.

The Kenya Airports Authority (KAA) acknowledged the aging infrastructure at JKIA as a threat to the country’s regional competitiveness. KAA stated that Adani’s proposal will undergo technical, financial, and legal reviews. However, the proposed deal has faced criticism for its lack of transparency, prompting some Kenyans to plan protests at JKIA. Despite advice to launch a competitive public bidding process, the Government of President William Ruto, has reportedly allowed the unsolicited proposal. Kenya has been recently rocked by anti-government protests sparked by rising cost of living and corruption.

In 2023, JKIA recorded 40,263 flight landings, still below the pre-Covid 2019 figure of 45,816. Passenger arrivals in 2023 totalled 4,094,994, compared to 4,102,928 in 2019. The International Air Transport Association reports that while progress has been made, inadequate air transport infrastructure remains a challenge in many African countries. By 2035, Africa’s passenger traffic is expected to nearly double, reaching 260 million passengers travelling to, from and within the continent. Furthermore, the successful implementation of the African Continental Free Trade Area is anticipated to boost air freight demand by 28%.

Meanwhile, Singapore’s Changi Airports International (CAI), the global investment and consulting arm of Changi Airport Group, has already made inroads into the African market. In February, CAI signed a two-year technical partnership with Angola’s national airports management company, Sociedade Gestora de Aeroportos (SGA). This partnership aims to maximise the traffic potential and profitability of 16 regional airports managed by SGA. Additionally, in 2023, CAI inked two agreements to develop Cairo International Airport in Egypt, one of the busiest airports in Africa. The first consultancy agreement focuses on improving passenger experience, while the second involves a feasibility study for Cairo Cargo City, a new cargo and logistics development area at the airport.

 

References

‘Changi Airports International and Cairo Airport Company sign agreements to develop Cairo International Airport and conduct technical feasibility study to establish area for cargo and logistics’, Changi Airport Group, 17 August 2023

‘Review of maritime transport 2023’, United Nations Conference on Trade and Development, 2023

‘Changi Airports International inks a 2-year technical partnership agreement with Sociedade Gestora de Aeroportos’, Changi Airport Group, 22 February 2024

‘Senator questions ‘secret’ deal to lease JKIA to Indian firm Adani’, Nation, 18 July 2024

‘Statement on the Jomo Kenyatta International Airport concession’, Kenya Airports Authority, 24 July 2024

‘Kenya is not asleep anymore: Why young protesters are not backing down’, Al Jazeera, 24 July 2024

‘Documents reveal details of Adani Group's controversial bid to run Kenya's largest airport’, OCCRP, 24 July 2024

‘Adani Group submits investment proposal to upgrade Nairobi airport’, The Economic Times, 24 July 2024

‘Kenya receives Adani proposal to invest in its biggest airport’, Bloomberg, 25 July 2024

‘Focus Africa media briefing’, International Air Transport Association, Accessed 28 July 2024

‘Annual tourism sector performance report’, Ministry of Tourism and Wildlife, 2024