The government has ruled out raising the 49 per cent cap on foreign direct investment
(FDI) in Indian aviation sector.
Asked about whether there's a chance of FDI cap being raised to save the ailing sector, Civil Aviation Minister Ajit Singh said: "I don't think so. Because the 1934 Civil Aviation Act says management has to be in Indian hands, majority of directors have to be Indian. Whatever worries people have, government will still decide the routes, government will still give at what time they fly and where."
India allows FDI in domestic airlines up to 49 per cent but had been disallowing foreign airlines from investing in the sector. The government, however, is now planning to allow foreign airlines to pick up 49 per cent stake in their Indian counterparts.
When pointed out to him that
some Indian carriers favoured raising the 49 per cent FDI cap, Singh said: "Now, they have all changed. See, it is a capital-intensive industry... even working capital they are not getting. It is only if you allow them to, airlines to invest 49 per cent. FDI is already allowed. We are not asking anybody to take it. It is not compulsory. Those who do not want it, fine."
Singh also said the ruling coalition partners are being brought on board on the issue of FDI in aviation.
with PTI inputs 
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