Govt says no to raising FDI cap in aviation.

HYDERABAD: The government ruled out raising the 49% foreign direct investment (FDI) cap in the Indian aviation sector on Sunday. "I don't think so. Because the 1934 Civil Aviation Act says management has to be in Indian hands, majority of directors have to be Indian. Whatever worries people have, government will still decide the routes, government will still give at what time they fly and where," civil aviation minister Ajit Singh told reporters while replying to a query.

"Now, they have all changed. See, it is a capital-intensive industry... even working capital they are not getting. It is only if you allow them to, airlines to invest 49 percent. FDI is already allowed . We are not asking anybody to take it. It is not compulsory. Those who do not want it, fine," he said.

India allows up to 49% FDI in domestic airlines but had been disallowing foreign airlines from investing in the sector. The government, however, is now planning to allow foreign airlines to pick up 49% stake in their Indian counterparts.

The ruling coalition partners are also being brought on board on the issue of FDI in aviation, Singh said. He also sounded a warning to the striking Air India pilots. He said the government is not waiting for the pilots to return to work but making plans to move ahead. Reminding the pilots and other employees that their survival was linked to Air India, he said that nobody is going to give anymore public money to the airline and "they will not survive for too long" if the company does not become competitive.

"We are not waiting. We are making plans. If you take the pilots trained in V-737 or Airbus 320, (in) three to six months they can be trained to fly these planes... So, in our plan for revival - when we implement the Dharmadhikari report - we have to be very patient and firm at the same time." "There will be many such hiccups on the way," he added.

Contending that there are "no issues" to go on strike and the pilots were "ill", he said plans were afoot to induct and train more pilots. He, however, said the government is ready to listen to the concerns of pilots once they return to work and address them seriously without being vindictive in any way. "I don't understand why they are on strike to begin with. There are no issues. Whatever few issues they had, that's exactly what Dharmadhikari report is meant to address.

"We have already started discussions . Secondly, they did not even give any notice. So, it is not a strike." The minister said the High Court had directed the pilots to return to work. "It is an illegal strike. I said even in Parliament that let them come back to work, we will listen to all their problems. Government will not be vindictive in any way. So, it seems to me that they do not want to come back to work," he said.

Source : economictimes.indiatimes.com