New Delhi : Senior ministers will meet tomorrow to take a decision on the contentious issue of permitting foreign airlines to invest in domestic carriers. The meeting will be attended by Civil Aviation Minister Ajit Singh, Finance Minister Pranab Mukherjee, Petroleum Minister S Jaipal Reddy and Commerce Minister Anand Sharma.
Also, on the agenda are decisions whether to allow Indian carriers to directly import fuel, which could lead to Rs 2,500 crore worth of annual cost savings for airlines, and extend the credit period given for payment of airport fees and fuel.
A final decision on the FDI issue is crucial, especially at a time when many domestic carriers have been deep in debt and require a sizeable infusion of cash, which is not available in the domestic market. Many international carriers such as British Airways, Singapore Airlines and Air Asia, among others, had shown interest in investing in Indian carriers. The domestic airline industry, despite a feared slowdown, has been doing reasonably well, with passenger growth at 18 per cent in the last calendar year. It is expected to grow at a comfortable clip of above 15 per cent this year. The market has seen fares go up by around 15 per cent.
17/01/12 Business Standard
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