Mumbai: Singapore Airlines (SIA) chief executive officer Goh Choon Phong has said it will be a challenge to run a succesful joint venture airline in India.
"By no means do we think that this is going to be a walk in the park. The venture, setting up in India, will have its challenges. We are all familiar with some of the challenges in India. It's a very competitive market domestically, and as a new start-up the current rule says that one has to operate for five years, and to reach a fleet of 20 aircraft before you're allowed to go overseas. And we all know how competitive the domestic market is, and therefore it is going to be a highly challenging venture to actually make it work,'' SIA's chief executive officer said on Wednesday in an interaction with analysts.
Last month the Foreign Investment Promotion Board gave its nod for the Tata-SIA airlines. Singapore Airlines will hold 49% stake in the airline and balance 51 will be held by Tata group. An initial investment of $ 100 million will made in launching full service airline with a hub in Delhi. The Tata-SIA venture is the third foreign direct investment proposal to receive FIPB nod after the government relaxed FDI norms last year.
G C Phong however expressed confidence as the airline had found the right partner in the Tata group and current environment conducive to investment and growth. "We believe that we have the best partner we could find, someone we know for a long time, which is Tata Sons,'' he said.
14/11/13 Aneesh Phadnis/Business Standard
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"By no means do we think that this is going to be a walk in the park. The venture, setting up in India, will have its challenges. We are all familiar with some of the challenges in India. It's a very competitive market domestically, and as a new start-up the current rule says that one has to operate for five years, and to reach a fleet of 20 aircraft before you're allowed to go overseas. And we all know how competitive the domestic market is, and therefore it is going to be a highly challenging venture to actually make it work,'' SIA's chief executive officer said on Wednesday in an interaction with analysts.
Last month the Foreign Investment Promotion Board gave its nod for the Tata-SIA airlines. Singapore Airlines will hold 49% stake in the airline and balance 51 will be held by Tata group. An initial investment of $ 100 million will made in launching full service airline with a hub in Delhi. The Tata-SIA venture is the third foreign direct investment proposal to receive FIPB nod after the government relaxed FDI norms last year.
G C Phong however expressed confidence as the airline had found the right partner in the Tata group and current environment conducive to investment and growth. "We believe that we have the best partner we could find, someone we know for a long time, which is Tata Sons,'' he said.
14/11/13 Aneesh Phadnis/Business Standard
