DIPP proposes 26 % FDI in domestic airlines

New Delhi: The Department of Industrial Policy and Promotion (DIPP) on Tuesday moved a Cabinet note, proposing 26 per cent foreign direct investment (FDI) in domestic airlines, which are in crisis and need immediate infusion of funds.
The note is contrary to the proposed move by the Civil Aviation Ministry, which has stuck to 24 per cent FDI in domestic carriers. The move comes at a time when several domestic airlines, including Kingfisher, are in complete financial mess and struggling to maintain their day-to-day operations.
“Private airlines are in dire need of funds for their operations and service upgradation to compete with other global carriers. They need immediate infusion of funds,'' the note circulated has stated. The Cabinet note has been sent to various ministries for their inputs before being placed before the Union Cabinet.
“Investor with 26 per cent or more holding is considered strategic, as he can have a say in the policy decision of a corporate entity under the Indian company laws.
22/11/11 The Hindu

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Categories: Foreign Nov 2011, Indian Aviation- In General Nov 2011