India allows foreign investors to own up to 49 percent of Air IndiaStaff Writer | January 10, 2018
India cleared a proposal to allow foreign investors to own up to a 49 percent stake in state-run carrier Air India, paving the way for global airlines to bid for the loss-making flagship carrier.
Airline Air India is to be sold
India allows 100 percent foreign investment in its other local airlines, but caps foreign airlines' stake at 49 percent.
Prime Minister Narendra Modi's cabinet gave the go-ahead last year to sell Air India, after successive governments spent billions of dollars in recent years to keep it going. However, it has yet to decide what to do with the carrier's debt burden of $8.5 billion.
Leslie Thng, chief executive of Vistara, a carrier owned by salt-to-steel conglomerate Tata Group and Singapore Airlines Ltd, last week said the companies were "open to evaluating" a potential bid for Air India.
And companies, including low-cost Indian carrier IndiGo, owned by InterGlobe Aviation, Tata Group and Turkey'sCelebi Aviation Holdings, have expressed an interest in buying some of Air India's various businesses.
The government also allowed 100 percent foreign direct investment (FDI) in single-brand retail via automatic route and eased a rule on 30 percent mandatory local sourcing of products for five fiscal years after the opening of the first Indian store. ■