Government of India on Wednesday removed restrictions of FDI in National air carrier Air India and allowed 49% FDI in the sector. The Cabinet on 10/01/2018 allowed 49% foreign direct investment in national carrier Air India under the approval route and opening up 100% FDI in single-brand retail under the automatic route. This move is expected an addition to Air India's divestment process. A group of ministers are in the process of finalising the plan for the proposed strategic disinvestment in the national carrier and expression of interest is likely to be invited from bidders soon.
Under the existing policy any foreign entity can hold upto 49% stake in an Indian Airlines company, however this policy is not applicable to National Airline service provider Air India government by seeing Air India going into losses from past few years and its inability to recover taken up a step for the recovery of National airline allowed 49% FDI in National air carrier.
The cabinet also allowed 100% FDI under the automatic route for single-brand retail as well as easing sourcing norms. Under the present policy only 49% FDI is allowed under the automatic route.
Civil Aviation Minister-Ashok Gajapathi Raju recently explained the process of disinvestment in Air India a state owned public entity and said: "This Committee will take a decision as to what has to happen there. As of now, if any suggestion from any quarter are welcome and the Government will definitely take them into consideration. The ultimate idea is to make Air India a vibrant airline with a professional management and also for its recovery from continuous losses from past years. Without professionalism in the management, there is hardly any scope of improvement in Air India." CAM-Ashok Gajapathi Raju also said that government has taken this step for the benefit of Air India.
Courtesy/By: Himanshu Goel
|
12 Jan 2018
