Check-in delayed for Delhi airport hotels over security

Wed Apr 3, 2013 5:43am EDT
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By Aditi Shah and Anurag Kotoky

MUMBAI/NEW DELHI (Reuters) - The 287-room Lemon Tree Premier hotel at Delhi's Indira Gandhi International Airport features a dramatic view of planes landing and taking off, but it has no guests to see them.

The hotel - one of 12 built or planned next to India's busiest airport at a cost totaling more than $2 billion - has been unable to open as it awaits security clearance from police worried about its proximity to an active runway. The cluster of hotels known as Aerocity, on a site bigger than 40 American football fields, was approved by the government six years ago.

India is eager to attract foreign investment to revive economic growth that is stalling at a decade low and help plug a current account deficit that has widened to a record. Yet bureaucratic hurdles including a lack of coordination among authorities still plague big-ticket projects, such as the hotel development at the capital's showpiece $3 billion airport.

"On the one hand the prime minister wants to drive investment into the country, the finance minister is travelling halfway around the world to get investment, but on the other hand these things spoil the country's reputation," said Rahul Pandit, CEO of Lemon Tree Hotels.

The Lemon Tree Premier and 208-room Red Fox have been ready to open since late December and are losing a combined 2 million rupees ($36,800) a day, said Pandit of Lemon Tree, which is backed by U.S. private equity firm Warburg Pincus.

A property under French giant Accor SA's Ibis brand, which does not face the runway, has been ready for more than a month, its developer said.

A swanky JW Marriott hotel, operated by Marriott International Inc, is due to open this month, according to its website.

The 43-acre Aerocity site owned by Delhi International Airport Ltd (DIAL) - a consortium led by GMR Infrastructure Ltd and including the Airports Authority of India, Germany's Fraport and Malaysia Airports Holdings Berhad - sits about 400 meters from the runway. Between the runway and the hotels lies an aircraft taxiway.   Continued...

A view of the interior of the newly-constructed Lemon Tree Premier hotel, located outside the Indira Gandhi International Airport in New Delhi April 2, 2013. REUTERS/Adnan Abidi