Indian air not clear for foreign airlines

New Delhi: As the centenary celebrations (1911-2011) of civil aviation in India taper off, all the airlines recently faced a rap from the aviation regulator for cutting corners on safety-related issues due to mounting losses and perceived lack of funds but the carriers can heave a sigh of relief as the government on Tuesday decided to consider allowing foreign airlines pick equity in Indian airlines.
With almost all Indian carriers, including state-owned Air India, battling hard to tide over their losses, whether the permission, if granted, to foreign airlines to pick up 49 per cent stake in Indian airlines will be able to do wonders to the sagging civil aviation sector in the country remains to be seen.
As per the existing norms, foreign airlines, if allowed, will be able to pick up to 49 per cent stake in publicly quoted carriers, aviation analysts say. In such a scenario, only Jet Airways, Kingfisher and SpiceJet would qualify. Other private carriers such as GoAir and IndiGo are completely privately-owned.
Norms of the Securities and Exchange Board of India (SEBI) will also be applicable to foreign airlines, meaning they would need to pick up shares of the Indian carriers from the open market as well. Given the fragile state of financial health of Jet Airways, the largest private carrier owned by Naresh Goyal who still holds 80 per cent shares, and Vijay Mallya-promoted Kingfisher, it would be anybody's guess as to which foreign airlines would wholeheartedly invest in them.
20/01/12 Vinay Kumar/The Hindu

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Categories: Foreign Jan 2012, Indian Aviation- In General Jan 2012