Dismissing concerns over foreign investments in AirAsia, Commerce and Industry Minister Anand Sharma today said that FIPB took the decision of allowing FDI after careful scrutiny.
"You have to clearly read the press note. It is FDI in civil aviation in an existing airline or in the capital of a company. See, you have to look at the fine print. I am sure this decision has been made after very careful scrutiny of the policy and its understanding by the FIPB," Sharma told reporters here.
The Foreign Investment Promotion Board (FIPB) yesterday cleared the Malaysian budget carrier AirAsia's bid to launch an airline in India by joining hands with Tata Sons.
However, soon after the FIPB nod to the proposal, the Civil Aviation Ministry sought further clarity on the FDI policy in aviation, particularly on whether a foreign airline could invest in a new venture.
"There are some procedural problems... The notification says (investment by a foreign airline in) an Indian carrier. So they (investor) have to follow the procedure because the Cabinet took a decision, following which the Commerce Ministry issued the notification," Civil Aviation Minister Ajit Singh has said.
AirAsia has announced it would set up a 49:30:21 joint venture with the Tata Sons and Telestra Tradeplace of Indian investor Arun Bhatia to launch a new Indian airline.
The initial investment by the AirAsia-led joint venture would be Rs 80 crore.
An official said the FIPB clearance was granted in accordance with the policy which allows up to 49 per cent FDI by a foreign carrier in an Indian airline company.
With the FIPB clearance, the AirAsia joint venture would now have to approach aviation regulator Directorate General of Civil Aviation (DGCA) for further clearances and a scheduled air operator's permit which allows an airline to undertake flying operations.
