The Modi government is unlikely to sell Air India to a foreign carrier and has clarified it in the consolidated Foreign Direct Investment policy, released today. It has said that the rule allowing foreign carriers to own up to 49% in Indian carriers do not apply to Air India.
“The policy mentioned at para (c) above (foreign carriers allowed to own 49% in Indian carriers) is not applicable to M/s Air India Limited,” the government clarified in consolidated FDI policy released today.
The Modi government has decided to sell stake in Air India and has formed a committee, headed by finance minister Arun Jaitley, to decide on the model of privatisation to be followed.
The policy is also likely to put a spanner on Qatar Airways’ plan to launch an airline venture in India alongwith Qatar-based investment authority by keeping a clause that mandates substantial ownership to stay with Indians.
“A Scheduled Operator’s Permit can be granted only to a company, if the substantial ownership and effective control of which is vested in Indian nationals,” the policy read.
