New Delhi: In a significant move to boost regional air connectivity, the government today relaxed norms allowing up to 49 per cent foreign direct investment through the automatic route in regional carriers.
Currently, foreign entities can own up to 49 per cent stake in domestic airlines, including regional ones, but need prior government approval.
Now, regional carriers are allowed to offload up to 49 per cent stake to overseas entities without seeking Foreign Investment Promotion Board (FIPB) nod.
There are at least three regional airlines -- Air Costa, Air Pegasus and True Jet -- operating on various routes and which between them have more than 460 flights every week.
Unveiling the relaxations in FDI norms for as many as 15 sectors, the government in a release today said, "Regional air transport service (RSOP) will also be eligible for foreign investment up to 49 per cent under the automatic route."
Currently, FDI up to 49 per cent is allowed in scheduled air transport service/domestic scheduled passenger airline.
At least two of the three regional airlines are exploring opportunities to collaborate with foreign players, including a possible stake sale.
Meanwhile, foreign equity caps in non-scheduled air transport and ground-handling services have been increased to 100 per cent from 74 per cent, the government added.
The easing of FDI norms also comes at a time when the government has proposed various measures to bolster regional air connectivity in the revised draft civil aviation policy.
10/11/15 PTI/F.Business
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Currently, foreign entities can own up to 49 per cent stake in domestic airlines, including regional ones, but need prior government approval.
Now, regional carriers are allowed to offload up to 49 per cent stake to overseas entities without seeking Foreign Investment Promotion Board (FIPB) nod.
There are at least three regional airlines -- Air Costa, Air Pegasus and True Jet -- operating on various routes and which between them have more than 460 flights every week.
Unveiling the relaxations in FDI norms for as many as 15 sectors, the government in a release today said, "Regional air transport service (RSOP) will also be eligible for foreign investment up to 49 per cent under the automatic route."
Currently, FDI up to 49 per cent is allowed in scheduled air transport service/domestic scheduled passenger airline.
At least two of the three regional airlines are exploring opportunities to collaborate with foreign players, including a possible stake sale.
Meanwhile, foreign equity caps in non-scheduled air transport and ground-handling services have been increased to 100 per cent from 74 per cent, the government added.
The easing of FDI norms also comes at a time when the government has proposed various measures to bolster regional air connectivity in the revised draft civil aviation policy.
10/11/15 PTI/F.Business
