18-Jan-2012 12:27 PM

India ministers agree to proposal for 49% FDI by foreign airlines in Indian airlines

India’s Civil Aviation Minister Ajit Singh said Finance Minister Pranab Mukherjee has "agreed to the proposal to bring out a cabinet note on 49% FDI by foreign airlines", adding that there was "broad consensus" to enable foreign airlines to acquire up to a 49% stake in domestic airlines. According to reports in local media sources including PTI, The Hindu, Hindustan Times and Business Standard, Mr Singh noted that foreign direct investment (FDI) “is one of the factors that will help the sector that is in financial stress”. He added: "We all know the aviation industry is facing a lot of stress". A note on the proposal will soon be sent to the Federal Cabinet for final approval, he added. India currently prevents international airlines from acquiring a stake in domestic airlines although foreign investors are allowed to hold a cumulative 49% in a domestic airlines.

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