FDI in aviation may not find takers, warns IATA chief

Geneva: A top aviation industry representative has expressed doubts whether allowing foreign airlines to invest in Indian carriers would attract them enough to put in money now, when the domestic industry was in a financial mess.
However, he strongly supported the need for further liberalisation of India’s FDI policy in aviation as well as slashing of high taxes on jet fuel.
“In today’s difficult environment, generally speaking, many airlines are trying to keep their balance-sheets strong rather than investing in other airlines. .... Investing in loss-making business is obviously not a winning strategy,” IATA Director General and CEO Tony Tyler told PTI in an interview here. Almost all Indian carriers have suffered losses in the past two years.
But Mr Tyler made it clear that if investment by foreign airlines was allowed, “then investments from different kind of sources will arrive. ... Certainly, Indian laws are very restrictive on foreign investments in airlines.”
If FDI policy was liberalised, “you will see foreign money coming into the aviation market, because it is a rapidly growing market. Therefore, aviation-friendly policies are required, particularly lifting the dead weight of taxation,” Mr Tyler said when asked about the proposal to allow foreign airlines to pick up equity in Indian carriers.
18/12/11 The Hindu

To Read the News in full at Source, Click the Headline

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