FDI in aviation sector set for overhaul

New Delhi: Faced with huge infrastructure requirements for the fast growing aviation sector, the government will soon announce a major liberalisation in FDI policy, hiking the threshold limit in many of the ground handling and support services to 100 per cent.
"The annual FDI policy review has already started and aviation services is one area where the government wants to go all out to attract investment from overseas," a senior official said.
Helped by intense competition and burgeoning of low cost carriers, the Indian aviation industry is growing at the annual rate of 25-30 per cent.
However, the growth has generated the need for improving aviation services like ground-handling, maintenance and training, according to analysts.
"In these services FDI could go to 74-100 per cent. In many of these areas FDI would be allowed through automatic route," he said.
At present, all Air Transport Services come under a common head and FDI of up to 49 per cent is allowed. Now, these services will be treated separately.
Sources said in air charter services too FDI regime will be liberalised. The announcement about the changes in FDI policy in aviation and other sectors is expected in a month or so.
06/06/07 Financial Express

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Categories: Foreign Jun 2007, General Aviation Jun 2007