Civil aviation minister Vayalar Ravi said the government is considering the recommendation of the Department of Industrial Policy & Promotion to allow foreign carriers to pick up stake in domestic airlines. However, the ministry has not finalised its view on the proposal, he added
Mumbai: Civil aviation minister Vayalar Ravi on Monday said it is considering the recommendation of the Department of Industrial Policy & Promotion (DIPP) to allow foreign carriers to pick up stake in domestic airlines, reports PTI.
“Yes. It is true that we have not rejected the DIPP’s recommendation (on allowing foreign airlines to invest in domestic carriers). It is under our consideration,” Mr Ravi told reporters on the sidelines of the fourth International Civil Aviation Negotiation Conference 2011 (ICAN 2011) here.
However, the minister added that his ministry has not finalised its view on the DIPP proposal.
On the ailing national carrier, which is sitting on a debt pile of close to Rs64,000 crore including accumulated losses, Mr Ravi said that his first priority is to increase the cash flow of Air India which is struggling with interest payments and high aviation turbine fuel (ATF) cost.
He also said his ministry is trying to get the sales tax on ATF reduced by all the states.
“Only Kerala and Andhra did not raise sales tax on ATF when prices went up. All other states increased sales tax on ATF and we are talking to these states.”
Another focus area is cutting down the expenses of the airline, the minister said.
“Air India needs to make money. We can make money by setting up an MRO (maintenance, repair and overhaul) outfit.
But there are differences of opinions. If an MRO is set up, Air India employees must be sent to the new outfit, but not everyone is keen on being sent there.
“I have to strike a compromise with various interests,” the minister said.
Mr Ravi was, however, reluctant to discuss plans for equity infusion into the flag carrier, but indicated that during the last week of this month, there will be a meeting of the empowered group of ministers on this.
On whether the country would demand ‘fifth freedom rights’ from foreign carriers, aviation secretary Nasim Zaidi said, “We will keep the domestic aviation interest in mind.”
He dispelled concerns of certain private airlines which feel that bilateral negotiations may largely end up benefiting Air India at their cost.
“When it comes to negotiation of bilateral flying rights, Air India itself may not be able to utilise the entire quota.
Private carriers too are Indian carriers.
“I had a meeting with the private carriers on Saturday and they shared their concerns with me. You must also remember that we have been accused of giving away rights to fly overseas to private carriers,” Mr Zaidi said.
When asked about why erring officials responsible for recruitment scams were not suspended, he said there was a serious lack of trained manpower in the DGCA.
According to the RBI data, as many as 401 overseas investment transactions were carried out by various companies in September, with the GVK Power & Infrastructure leading the pack
Mumbai: Overseas investments by Indian companies in September were $3.46 billion, with GVK Power, ETHL Communication and Tata Steel, among others, committing investments abroad, reports PTI.
The FDI outflows last month was 51% more than the $2.28 billion outflow in August.
According to the RBI data released yesterday, as many as 401 overseas investment transactions were carried out by various companies in September, with the GVK Power & Infrastructure leading the pack.
It has committed $1.41 billion in its Singapore-based joint venture—GVK Coal Developers (Singapore) which is engaged in transport, storage and communication services.
ETHL Communications Holdings has committed $776.88 million in its Mauritius-based wholly-owned subsidiary (WoS).
The subsidiary, ETHL Communications Mauritius, is engaged in financial, insurance, real estate and business services, the data said.
Tata Steel has committed $173.55 million in its Singapore-based WoS, Tata Steel Asia Holdings Pte, which is also engaged in financial, insurance, real estate and business services.
RHC Holding investments in its WoS based in Mauritius has committed $113.62 million investment. The WoS is engaged in similar business as that of Tatas’ in Mauritius.
As per the data, Jindal Saw has committed invested $78.64 million in September in its Cyprus-based manufacturing WoS—Ralael Holdings. Besides, the Indian firm has also committed an investment of $48.31 million in n its UAE-based WoS Jindal Saw Holdings FZE, which is also engaged in manufacturing activities.
In the first six months of this fiscal (April-September), the outward FDI stood at $19.01 billion.
While Indian companies are spreading their overseas footprints, the FDI inflows in the April-August (latest data available), too, went up by a huge 95% to $17.37 billion from $8.89 billion in the corresponding period last year.
A finance ministry official said that the FIIs have almost exhausted the Rs43,650 crore ($10 billion) investment limit for purchase of G-secs and they would not be able to buy more securities unless the ceiling is enhanced
New Delhi: The government is likely to soon increase the purchase limit of government securities (G-secs) by the foreign institutional investors (FIIs), a move that will help it meet the enhanced market borrowing target without hurting liquidity position in the system, reports PTI.
The FIIs, a finance ministry official said, has almost exhausted the Rs43,650 crore ($10 billion) investment limit for purchase of G-secs and they would not be able to buy more securities unless the ceiling is enhanced.
As per the latest data, the FIIs’ investment in G-secs were at Rs42,388 crore.
“We could increase the limits for FIIs investment in G-secs soon as we need money,” a finance ministry official said without specifying the proposed limit.
G-secs comprise treasury bills and dated securities issued by the central and state governments.
The government last month revised its market borrowing programme for 2011-12 and decided to raise an additional Rs52,800 crore. Following the revision, the government will raise Rs4.7 lakh crore from the market, up from Rs4.37 lakh crore in the previous fiscal.
There are apprehensions that increased government borrowing would reduce the credit availability for the private sector.
The government had earlier relaxed the norms for FII investment in long term infrastructure bonds.