By: Nikhil Gulati
Source: http://online.wsj.com
Category: Investment In India
NEW DELHI -- A panel of Indian ministers has recommended allowing foreign airlines invest in the country's aviation sector and to let local carriers directly import jet fuel, Aviation Minister Ajit Singh said Tuesday.
"A note has already been prepared on FDI [foreign direct investment]. It will go to the cabinet soon," he told reporters.
Both proposals are meant to support local aviation companies, such as Kingfisher Airlines Ltd., which have been severely hit by losses due to high fuel costs and interest rates. The financial troubles have discouraged private-equity investors as well as lenders from putting money into the sector.
Foreign airlines are currently barred from buying stakes in Indian aviation companies, but some carriers and several sections of the government feel they may invest if allowed to do so because of the long-term positive growth prospects of the industry.
Jet fuel accounts for up to 45% of the total costs for an Indian carrier. Importing the fuel would allow an airline to save on sales tax imposed by local governments.
Source: http://online.wsj.com/article/SB10001424052970204369404577208332614449886.html
Source: http://online.wsj.com
Category: Investment In India
NEW DELHI -- A panel of Indian ministers has recommended allowing foreign airlines invest in the country's aviation sector and to let local carriers directly import jet fuel, Aviation Minister Ajit Singh said Tuesday.
"A note has already been prepared on FDI [foreign direct investment]. It will go to the cabinet soon," he told reporters.
Both proposals are meant to support local aviation companies, such as Kingfisher Airlines Ltd., which have been severely hit by losses due to high fuel costs and interest rates. The financial troubles have discouraged private-equity investors as well as lenders from putting money into the sector.
Foreign airlines are currently barred from buying stakes in Indian aviation companies, but some carriers and several sections of the government feel they may invest if allowed to do so because of the long-term positive growth prospects of the industry.
Jet fuel accounts for up to 45% of the total costs for an Indian carrier. Importing the fuel would allow an airline to save on sales tax imposed by local governments.
Source: http://online.wsj.com/article/SB10001424052970204369404577208332614449886.html
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