Even though a cabinet note is ready and top cabinet ministers are in favour of the idea, the policy to allow 49% foreign direct investment in the civil aviation business is still grounded. The reason: It is yet to receive support from the Trinamool Congress boss and West Bengal chief minister Mamata Banerjee.

Top sources in the government said that civil aviation minister Ajit Singh had met Banerjee in May, but failed to get her consent.

The proposed FDI policy will allow foreign airlines to pick up stakes of up to 49% in domestic airlines. On April 12, while approving the bailout package for Air India (AI), many cabinet ministers pressed for allowing FDI in civil aviation as well.

Some even suggested that AI be allowed to get FDI for two years as a test-case before taking a final call on the entry of foreign investors in the sector.