According to Centre's notification, “The Government of India has reviewed the position in this regard and decided to permit foreign airlines also to invest in capital of Indian companies operating scheduled and non-scheduled air transport services up to the limit of 49 per cent of their paid up capital.”
Meanwhile, TMC Supremo and West Bengal Chief Minister Mamata Banerjee hit out at UPA government for notifying FDI in multi-brand retail. Centre feels that the reform step would help pave way for equity infusion into the debt-ridden Indian carriers which are facing the requirement of funds for operations.
Last week, the Cabinet Committee on Economic Affairs gave permission to foreign airlines to invest in scheduled and non-scheduled air transport services. This would offer some relief to the cash-strapped aviation sector.
The investments are slated to be made under the Centre approved route and the companies need to follow regulations of market watchdog Securities and Exchange Board of India (SEBI) such as issue of capital and discloser requirement and substantial acquisition of shares and takeovers regulations.
In the past, no foreign carriers were given permission to invest in Indian carriers directly or indirectly.