New Delhi: India may have allowed foreign entities to fully own a desi carrier, but it now needs to change some of its ownership rules to allow such airlines to fly in the country and get clarity on international norms for their overseas operations.
Under current rules, the government grants a licence to run an airline (AOP — air operator permit) only if that entity's chairman and two-thirds of its directors are Indians and the "substantial ownership and effective control" (SOEC) is with Indian nationals. Also, International Civil Aviation Organisation (ICAO) says that an airline's SOEC should be with the nationals of a country if such an airline wishes to fly out of that country.
While aviation secretary R N Choubey, the architect of the new aviation policy, on Thursday said the SOEC norms for issuing AOP for airlines in India will be aligned with the new FDI rules, India will need to check the international norms for overseas flying by desi airlines that may be fully or substantially owned by foreigners.
"We will examine the SOEC norms of various countries that permit more than 49% FDI in airlines. We will review the existing policy for grant of AOP to bring it in line with the decision to allow 100% FDI in domestic airlines," Choubey said. The issue of SOEC being with Indians arises while issuing AOP and giving bilateral rights that India has to its airline for flying abroad. "For the purpose of granting AOP, as the FDI limit has been increased, correspondingly the AOP requirement of SOEC will also have to be aligned with it. That will require amendment," he said.
25/06/16 Kashmir Monitor
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Under current rules, the government grants a licence to run an airline (AOP — air operator permit) only if that entity's chairman and two-thirds of its directors are Indians and the "substantial ownership and effective control" (SOEC) is with Indian nationals. Also, International Civil Aviation Organisation (ICAO) says that an airline's SOEC should be with the nationals of a country if such an airline wishes to fly out of that country.
While aviation secretary R N Choubey, the architect of the new aviation policy, on Thursday said the SOEC norms for issuing AOP for airlines in India will be aligned with the new FDI rules, India will need to check the international norms for overseas flying by desi airlines that may be fully or substantially owned by foreigners.
"We will examine the SOEC norms of various countries that permit more than 49% FDI in airlines. We will review the existing policy for grant of AOP to bring it in line with the decision to allow 100% FDI in domestic airlines," Choubey said. The issue of SOEC being with Indians arises while issuing AOP and giving bilateral rights that India has to its airline for flying abroad. "For the purpose of granting AOP, as the FDI limit has been increased, correspondingly the AOP requirement of SOEC will also have to be aligned with it. That will require amendment," he said.
25/06/16 Kashmir Monitor
