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Business News/ Politics / Policy/  Subramanian Swamy raises issue of foreign airlines investing in local airlines
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Subramanian Swamy raises issue of foreign airlines investing in local airlines

Subramanian Swamy asked the ministry for the text of the CCEA resolution of 2012 permitting foreign direct investment (FDI) of up to 49% by foreign airlines

A file photo of BJP leader Subramanian Swamy. Photo: ReutersPremium
A file photo of BJP leader Subramanian Swamy. Photo: Reuters

New Delhi: Bharatiya Janata Party (BJP) leader Subramanian Swamy on Wednesday raised in Parliament the issue of foreign airlines investing in local airlines.

Swamy, who has taken the aviation ministry to court over the grant of licences to new airlines like Vistara and AirAsia, asked the ministry for the text of the Cabinet Committee on Economic Affairs (CCEA) resolution of 2012 permitting foreign direct investment of up to 49% by foreign airlines.

“In 2012, CCEA permitted foreign airlines to invest, under the government approval route, in the capital of Indian companies operating scheduled and non-scheduled air transport services up to the limit of 49% of their paid-up capital with the proviso that this would not apply to Air India," aviation minister Ashok Gajapathi Raju said in his reply to Parliament.

Swamy has now sent the minister’s reply to the aviation regulator Directorate General of Civil Aviation (DGCA), which granted the airlines licences. He said the licences of Vistara and AirAsia were illegal as they were not operating airlines when they were given the permits, which he argued should be suspended.

AirAsia India is a joint venture between AirAsia Bhd and Tata Sons Ltd. Vistara is a joint venture between Tata Sons and Singapore Airlines Ltd.

“The answer clearly indicates that the permit given during the UPA (United Progressive Alliance) regime to Tata Air Asia and Vistara, JV of Tata and Singapore Airlines, is illegal as Tata group was never into airlines industry," the email, a copy of which was reviewed by Mint, reads. “Therefore, I request you to look into the matter immediately and the permit given to both the airlines during UPA regime should be suspended/cancelled."

The letter was copied to Swamy’s personal email address and also to the prime minister’s office.

Vistara said the matter was sub judice (before the courts) and therefore it cannot comment on it. AirAsia India did not reply to an email seeking comment.

DGCA chief M. Satyavathy, who is travelling, did not respond to calls and texts on her mobile.

Foreign airlines were allowed a 49% stake in Indian carriers in 2012. Etihad took a 24% stake in Jet Airways soon after. This was followed by the launch of AirAsia India and Vistara in India.

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Published: 21 Jul 2016, 01:33 AM IST
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