Domestic aviation to open up

New Delhi: The government is likely to allow foreign airlines to invest in Indian domestic air carriers in the forthcoming civil aviation policy and also raise the ceiling on foreign investment to considerably more than the current 49 per cent.
At present, foreign airlines cannot take equity in Indian carriers.
But the government may choose to limit the voting rights of foreign carriers holding equity in Indian airlines.
The policy, in its present form, does not say how soon these changes will be made. Civil aviation ministry officials said the time-frame and the equity a foreign airline will be allowed to hold in a domestic carrier will be specified later on “appropriate occasions”.
The proposed policy will also raise the entry barriers for new airlines, by upping the minimum equity cap to Rs 50 crore from the present Rs 30 crore.
But the minimum number of aircraft that a carrier needs to operate in the domestic sector remains at the present level of five.
17/05/06 Bipin Chandran/Business Standard

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