India's Union Cabinet on Wednesday approved the Foreign Direct Investment Policy (FDI) on Civil Aviation to attract bids for the privatisation of Air India, the country's debt-laden national carrier. The rule was amended after the airline failed to attract potential bidders in the first phase last year.
The amended proposal would permit foreign investments in Air India by non-residents of India (NRIs) up to 100 percent on automatic routes. Earlier, just 49 percent was available for sale to non-resident Indians in Air India.
Informing the media about the same, Federal Minister Prakash Javadekar said that India continues to remain a preferred destination for global FDI.
“Today’s decision of Air India is one milestone decision where NRIs who are Indian nationals will get permission to invest 100 percent in Air India. This will pave the way for fresh investments; passengers will continue to get better services and will improve the overall atmosphere of investments”, Javadekar said.
Currently, the federal government is in the process of inviting expressions of interest from interested bidders for the full service carrier Air India. This is the first phase, which is likely to be concluded by 31 March. After this, a request for proposals will be made for the shortlisted bidders.
The ailing national carrier is offering a 100 percent stake sale.