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Foreign airlines are given the green light to invest (read: save) Indian carriers

Excerpt from Firstpost

Sep 14, 2012 7:40 am

Skift Take

There are huge opportunities for growth in the Indian market, but few foreign airlines have the financial fortitude to take on an ailing airline like Kingfisher, which had pushed for the ban’s removal.

— Samantha Shankman

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There has been all-round cheer on the government’s decision to allow foreign airlines to invest up to 49 percent in Indian carriers this evening. Today’s move reversed a 1997 decision which had barred foreign airlines from investing in Indian ones.

The Surya Kiran Aerobatic Team (SKAT) at Aero India 2011

India reverses 1997 decision that blocked foreign airlines from investing in Indian ones. Photo by Ruben Alexander.

The 1997 decision, allegedly based on pressure from the domestic aviation lobby, had resulted in killing the proposed joint venture between Singapore Airlines and the Tata group. After that fiasco, the Tatas never managed to enter the aviation business again.

So, in a sense, the lifting of this ban on foreign airlines entering the domestic sector is a good move.

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