The only significant change has been the decision to allow foreign airlines to acquire up to 49% in Air India, these critics admit, but we are still far too early in the disinvestment process of the state-owned airlines to make much of this.
"Allowing 100% FDI under automatic route for the Single Brand retail will provide impetus to the development of infrastructural capabilities like warehousing and assist in creation of a well-organized and agile retail supply chains", said Anil Khaitan.
In a further sign of support for FDI, global airlines will now be able to own up to 49 per cent of Air India, subject to conditions. Apart from increasing the number of potential bidders interested in buying into Air India, this could also result in the emergence of interesting alliances between Indian investors or airlines and foreign airlines.More news: The Trump Administration Continues To Rail Against Michael Wolff's Book
However, the government has also made it clear that the substantial ownership and effective control of Air India would have to remain with Indian nationals. These are meant to liberalise and simplify the FDI policy so as to provide ease of doing business in the country. It has now been chose to do away with this provision, thereby allowing FIIs/FPIs to invest in power exchanges through primary market as well, the release said.
The SBRT entity will be required to meet the 30 per cent sourcing norms directly towards its India operation, on an annual basis, after the five-year period, a government release said. Furniture specialist Ikea, which plans to open stores in India later this year, has also been calling for the relaxation of the ruling.
49% stake for Air India, automatic 100% FDI in single brand retail and real estate.More news: You Might Prefer Spain's Title for Solo: A Star Wars Story
Since taking office in May 2014, Mr. Modi has eased foreign-investment rules.
CITU general secretary Tapan Sen said the airline's privatisation would give foreign entities control over the national carrier, which is a public sector company with a huge asset base and a high-revenue earning worldwide service network.More news: College Football Playoff returning to the Cotton Bowl at AT&T Stadium