India likely to consider foreign stake in domestic airlines: Praful PatelJanuary 14th, 2009 - 2:57 pm ICT by ANI
New Delhi, Jan 14 (ANI): Civil Aviation Minister Praful Patel today hinted at the possible buying of stakes in domestic aviation sector by foreign airlines.
Speaking to reporters on the sidelines of ”Petrotech 2009”, the eighth edition of Asia’’s largest petroleum exhibition and conference here, Patel said the Indian Government is considering various options to help the aviation industry come out of its current problems.
He added that allowing foreign investors is one measure being pondered over to help the sector overcome the financial crunch.
“There are various options before the government as to how do we try to support this industry in face of the current problems. We already have 49 per cent Foreign Direct Investment in the aviation sector. May be the time has now come to explore whether foreign airlines can also be permitted to invest part of that 49 per cent in the domestic sector,” said Patel.
Patel said no formal decision has been taken as yet about allowing 20 to 25 per cent foreign stake in the Indian domestic sector.
According to media reports, Kingfisher Airlines has requested the government to allow foreign airlines to pick up stakes of up to 25 per cent in the Indian carriers. It has said that foreign airlines had expressed interest in buying a stake in it.
India does not allow foreign airlines to invest in domestic carriers, although foreign portfolio investments are allowed.
A global credit crunch has made fundraising difficult for Indian carriers. Analysts have forecast them to collectively post losses of 80 billion rupees for the financial year ending March 2009. (ANI)
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