NRIs will be allowed to acquire up to 100% equity in Air India

THE  Union Cabinet chaired by Prime Minister Narendra Modi has decided to allow Non-Resident Indians (NRIs) to acquire up to 100 per cent equity in Air India, Disclosing the information  Union Minister for Information & Broadcasting Prakash Javadekar said on Wednesday March 4 FDI Policy has been amended to permit foreign Investments in Air India Ltd by NRIs who are Indian nationals, up to 100 per cent under automatic route. Earlier only 49% was available for sale to NRIs in Air India. Now they can purchase 100%,” he said. . Allowing 100 per cent investment by Non-Resident Indians (NRIs) in the carrier would also not be in violation of SOEC norms. NRI investments would be treated as domestic investments. Under the Substantial Ownership and Effective Control (SOEC) framework, which is followed in the airline industry globally, a carrier that flies overseas from a particular country should be substantially owned by that country’s government or its nationals. Currently, NRIs can acquire only 49 per cent in Air India. Foreign Direct Investment (FDI) in the airline is also 49 per cent through the government approval route. As per the existing norms, 100 per cent FDI is permitted in scheduled domestic carriers, subject to certain conditions, including that it would not be applicable for overseas airlines, says The Business Standard. (courtesy to The Financial Express for the picture)