Tata-SIA seeks aviation ministry approval

  • HT Correspondent, Hindustan Times, New Delhi
  • Updated: Dec 30, 2013 01:33 IST

Two months after the approval from the Foreign Investment Promotion Board (FIPB) to start a full-service passenger airline in India, Tata-Singapore Airlines (SIA) has now applied to the aviation ministry for a no-objection certificate (NoC).

“The Tata-SIA combine have applied for a NoC last week,” a senior aviation ministry official said.

On September 19, Tata-SIA had announced that they had signed a memorandum of understanding (MoU) and applied for FIPB approval to establish a new airline in India. The FIPB, nodal agency that clears foreign direct investments in India, had cleared the Tata-SIA proposal on October 24.

“Before the NoC is granted, a security clearance from the home ministry would be needed,” the official said. After the aviation ministry nod, Tata-SIA would need to apply to the aviation regulator Directorate General of Civil Aviation (DGCA) for an operator’s permit. The entire process could take up to four to six months.

Tata-SIA would jointly invest $100 million (approx Rs 620.2 crore) initially to set up the airline with Tata’s investing $51 million (approx Rs 316.30 crore). Tata Sons will own 51% and Singapore Airlines will own 49% in the joint venture.

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This is Tata-SIA’s third bid to enter the Indian domestic aviation market. In 1995, Tata and SIA had made the first attempt to launch a domestic carrier but the project could never take off due to a change in civil aviation policy. In 2000, the two had bid for a stake in Air India but the offer was withdrawn later.

Earlier this year, in February, the Tata Group announced it had signed an agreement with AirAsia and Telestra Tradeplace Pvt Ltd to launch an Indian low-cost carrier.

On September 20, AirAsia India got the NoC from the aviation ministry to start airline operations in India after which it applied to the aviation regulator for a permit. The DGCA permit could come by late January.

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