The latest news from the business reveals that a draft cabinet report by the Department of Industrial Policy and Promotion (DIPP) under the Commerce Ministry has offered 26 percent Foreign Direct investment (FDI) by foreign airlines in domestic airlines.
According to the press release made by the Department of Industrial Policy and Promotion (DIPP), “Private airlines in the country are in dire need of funds for their operations and service up gradation to compete with other global carriers.”
The DIPP has not moved from its stand telling a FDI of around 26 percent and not 24 percent, as suggested by the Civil Aviation Ministry.
The DIPP report states that anything less than 26 percent would not motivate proper investment from International airlines because in that case they will not have any power to block a special declaration in a board meeting under the Indian company laws.
In the meantime, the press release has been distributed among the civil aviation, law ministries and home ministries.
Presently, international entities, except foreign airlines are permitted to invest up to 49 percent in domestic passenger airlines. On the other hand, the non-resident Indians can invest 100 percent.