The Industry Ministry is in favour of allowing foreign airlines to invest in domestic carriers, saying it would help the cash-crunch industry to raise equity, an issue that does not find support among many Indian airlines.
The Department of Industrial Policy and Promotion (DIPP), an arm of the industry ministry which deals with FDI related matters, has sent several letters to the Civil Aviation Ministry on the issue of allowing foreign carriers to invest.
"The Indian aviation industry is in a crisis. If they get equity from foreign players, we should not come in the way," a senior DIPP official said.
In response to the DIPP letters, the Civil Aviation Ministry has
said that the matter was under their consideration. FDI up to 49 per cent is allowed in domestic airlines or 100 per cent for investments by NRIs, but the policy bars foreign airlines from investing, primarily on security grounds.