New Delhi: One step forward, two backward seems to be the mantra guiding the government while coming up with liberal FDI norms for the civil aviation sector. Two days after India's airlines were allowed 100 percent foreign investment without any caveats except a government nod after the foreign investment limit crossed 49 percent, fresh riders have emerged. If these apply, then any substantial investment by foreign entities in India's airline sector remains a pipe dream.
In fact, the emphasis of the government for domestic connectivity may mute global players' desire to invest further in India. Besides new riders on foreign investment in airlines, the process to do so may be cumbersome too. Civil Aviation Minister A Gajapathi Raju has hinted at a careful scrutiny of each proposal where foreign investment could be increased to beyond 49 percent, saying the government will take a call on whether such investments are needed and then too, on a case to case basis. Why announce opening of FDI floodgates and then put barrier just ahead of the flow?
Civil Aviation Secretary R N Chaubey said today that the issue of substantial ownership and effective control (SOEC) for airlines operating in India comes up at two stages - first when an airline applies for a flying permit and second when it wants to fly abroad. It is SOEC which could well put a spanner in foreign investors' plans.
23/06/16 Sindhu Bhattacharya/First Post
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In fact, the emphasis of the government for domestic connectivity may mute global players' desire to invest further in India. Besides new riders on foreign investment in airlines, the process to do so may be cumbersome too. Civil Aviation Minister A Gajapathi Raju has hinted at a careful scrutiny of each proposal where foreign investment could be increased to beyond 49 percent, saying the government will take a call on whether such investments are needed and then too, on a case to case basis. Why announce opening of FDI floodgates and then put barrier just ahead of the flow?
Civil Aviation Secretary R N Chaubey said today that the issue of substantial ownership and effective control (SOEC) for airlines operating in India comes up at two stages - first when an airline applies for a flying permit and second when it wants to fly abroad. It is SOEC which could well put a spanner in foreign investors' plans.
23/06/16 Sindhu Bhattacharya/First Post
