Govt puts off decision on raising FDI cap in aviation

The Union Cabinet on Thursday deferred a decision on raising the cap on foreign direct investment in the civil aviation sector.

"The issue has been deferred," Information and Broadcasting Minister PR Dasmunsi said when asked whether the Cabinet had considered the proposal by the Civil Aviation Ministry.

The Cabinet was to take a policy decision on the Civil Aviation Ministry's proposals to enhance the 49 per cent limit in non-scheduled airlines, chartered and cargo carriers to 74 per cent, without any direct or indirect participation of any foreign airline.

The Ministry has also proposed to raise the FDI cap for ground handling services to 74 per cent through the automatic route and to 100 per cent via same route for setting up of Maintenance, Repair and Overhaul (MRO) facilities and flying and technical training institutions, besides in helicopter and sea-plane services.

Civil Aviation Minister Praful Patel has been vocal in his support to launch seaplane operations in the country, which has a vast coastal belt.

He has also been supportive of expanding helicopter operations, not just to connect far-flung and hilly areas, but also for purposes like medical emergencies.

As regards MRO, the Indian aviation sector has already received firm proposals from aircraft manufacturers like Boeing and Airbus Industries to establish such facilities. The government also wants to make India an attractive MRO hub in this part of the world.