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Financial closure of Bengaluru International Airport Limited

Thillai Rajan (Indian Institute of Technology Madras, Chennai, India)
Josephine Gemson (Indian Institute of Technology Madras, Chennai, India)

Publication date: 1 October 2011

Issue publication date: 1 October 2011


Subject area

Infrastructure finance.

Study level/applicability

II MBA/Executive MBA (Project Finance, Infrastructure Finance).

Case overview

It is generally believed that the economy of India is on the threshold of achieving significant growth in the coming years. The availability of adequate infrastructure facility will play a key role in realizing this growth potential. To accelerate the process of creating infrastructure capacity, the Government of India has opened up many infrastructure sectors for private sector investment. Creation of international standard airport facilities is an important component of such new infrastructure creation. This case study presents the initial development and financing closure of Bengaluru International Airport Limited (BIAL), the first major private sector airport in India. In retrospect, it is generally felt that BIAL was an important milestone in the privatization of airports in India. The blueprint for the greenfield PPP airport in Hyderabad was closely modelled on the BIAL project. The experience gained in the development of BIAL also played a major role in subsequent brownfield PPP airport expansion projects in Mumbai and Delhi.

Expected learning outcomes

The goal of this case study is to illustrate the complexities that exist in the process of infrastructure development and financing. This following are the expected learning outcomes:

  • The importance of using an appropriate project structure.

  • The prevalence of early returns to project sponsors as compared to lenders.

  • The process of achieving financial closure.

  • Analyzing project risks and returns.

Supplementary materials

Teaching notes.



Rajan, T. and Gemson, J. (2011), "Financial closure of Bengaluru International Airport Limited", , Vol. 1 No. 4.



Emerald Group Publishing Limited

Copyright © 2011, Emerald Group Publishing Limited

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