Adding Emirates statement after para 14) New Delhi, Jan 10 (PTI) Singapore Airlines today said it will keep options open on Air India stake after the government allowed foreign carriers to own up to 49 per cent in the national carrier.
The cabinet also made it evident that foreign investments in Air India, including that of overseas airlines, will not be permitted to exceed 49 percent, either directly or indirectly.
The Modi government has brought AI on a par with private Indian airlines in terms of being eligible to be owned up to 49% by foreign airlines with the condition being that the desi carriers' substantial ownership and control (SOEC) should remain with Indians and the local JV partner.
Singapore Airlines will keep options open on disinvestment of Air India. The airline's domestic network covers 52 destinations, including far-flung areas of the North-East, Ladakh, Andaman and Nicobar Islands. Under the SOEC clause, the new promoters of Air India will have to keep its chairman Indian and can not shift its operational headquarters to anywhere outside the country. For instance, 49 per cent stake in Indian airlines such as Vistara and AirAsia India are owned by Singapore Airlines and AirAsia Berhad respectively.
Last week, Vistara CEO Leslie Thng said that Tata Sons and Singapore Airlines have an "open mind" on the issue of disinvestment of Air India and will evaluate if there was a business case for them. "Allowing foreign airlines to participate will increase the number of interested bidders and the valuation", aviation consultancy firm CAPA, said.
Foreign airlines will be able to buy up to 49% p of Air India under new rules approved by the government on Wednesday to boost the debt-laden flag carrier.
"Air India has been facing losses for the past many years on account of a multitude of factors like high fuel prices, high-interest burden, increasing competition especially from low-priced carriers, high debt-equity ratio, and high airport charges", Jayant Sinha, India's Minister of State for Civil Aviation said last week.
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