Cabinet approves 49% FDI in Air India

The Union Cabinet chaired by Prime Minister Narendra Modi has given its approval to a number of amendments in the FDI Policy -one of them allowing foreign airlines to invest up to 49 per cent under approval route in Air India. These are intended to simplify the FDI policy to provide ease of doing business in the country.
As per the extant policy, foreign airlines are allowed to invest under Government approval route in the capital of Indian companies operating scheduled and non-scheduled air transport services, up to the limit of 49 per cent of their paid-up capital. However, this provision was presently not applicable to Air India, thereby implying that foreign airlines could not invest in Air India. Foreign airlines can now invest up to 49 per cent under approval route in Air India subject to the conditions that foreign investment(s) in Air India including that of foreign airline(s) shall not exceed 49 per cent either directly or indirectly. Substantial ownership and effective control of Air India shall continue to be vested in Indian National.