labels: aerospace
Praful Patel: FDI may move beyond 49pc in select areas of aviationnews
24 April 2007
New Delhi: Indian civil aviation minister, Praful Patel, said Monday that the government is open to a review of its policies related to FDI in aviation. Though he ruled out any immediate moves to allow foreign airlines to pick up stake in Indian carriers, he clarified that the country is looking at liberalising policies related to the sector in order to attract investment. Patel was addressing the US-India Aviation Partnership Summit.

Ruling out FDI in Indian carriers, Patel, however, said that the government is considering a proposal to raise the 49% cap on FDI for non-scheduled operations, sea-planes and helicopters. "Government policies are not frozen, but they are moulded according to the changing requirements of the sector," he said.

Pointing out the 'enormous potential' of the Indian aviation sector, Patel said if only 10% of Indians switched to air travel in the next few years, compared with less than 1% now, the country "will require about 5,000 planes in place of 300 now".

As per civil aviation ministry estimates, India's booming aviation sector will need investments worth $120 billion by 2020. Of this amount, two-thirds is likely to be absorbed by aircraft purchases, and the remaining by infrastructure. The number of civilian aircraft in the country is also estimated to swell from 350 to 1,000 by 2020.

Speaking at the conference, civil aviation secretary, Ashok Chawla, said the number of domestic passengers would rise to 182 million per year by 2020 from 30 million now.

India and the US have already signed an MoU to establish the US-India aviation cooperation programme (ACP) that focusses on supporting activities related to air traffic, air space management, expanding airport facilities, installing airport security and monitoring systems and enforcing airworthiness certification and regulatory systems.

Addressing the conference, US Federal Aviation Authority (FAA) chief Marion C Blakey said there was great potential for a bilateral aviation safety agreement (BASA) between the two nations, more so, keeping in mind the growth in the Indian aviation sector.

The three day summit has attracted top government officials from the US and India, as well as  representatives from top American aviation firms ranging from Boeing, General Electric and Northrop Grumman to United Technologies, Pratt & Whitney, Lockheed Martin, Honeywell and Continental Airlines.


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Praful Patel: FDI may move beyond 49pc in select areas of aviation