A day after notifying a policy measure to allow foreign airlines pick up 49% stake in Indian carriers, the government on Friday said the aviation indus- try was in an upbeat mood as it was expecting a positive response to the move.
“The aviation sector is going through difficult times and facing financial stress due to the economic slowdown,” Singh said on the sidelines of an ASSOCHAM conference on Indian civil aviation sector here. “But the mood is upbeat now.”
A week after the Cabinet Committee on Economic Affairs took the decision, government on Thursday notified it to permit foreign airlines “to invest in capital of Indian companies operating scheduled and non-scheduled air transport services up to the limit of 49% of their paid up capital.”
This would pave the way for much-needed equity infusion in Indian carriers which are in dire need of funds, he said, adding that banks were currently unwilling to give money to the airline industry due to the prevailing financial distress.
Terming the problems faced by the aviation sector as temporary, Singh said the sector was vital for economic growth and was bound to grow with the growth of the middle class as air travel for it was now a necessity. Reuters & PTI