Tata Group - AirAsia Malaysia JV gets govt's nod to start new Airline

Discussion in 'Economy & Infrastructure' started by rahulrds1, Mar 6, 2013.

  1. rahulrds1

    rahulrds1 Regular Member

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    NEW DELHI: The finance ministry on Wednesday cleared the investment proposal of Malaysian budget carrier AirAsia which seeks to enter India through a joint venture with Tata Group and another company.

    "AirAsia's proposal has been cleared. It is as per the policy (which allows) up to 49 per cent FDI. Rs 80 crore is initial investment," a senior government official said.

    The Foreign Investment Promotion Board (FIPB), headed by DEA secretary Arvind Mayaram, approved the proposal at its meeting here.

    AirAsia has applied to FIPB to take 49 per cent in a venture with Tata Sons Ltd and Arun Bhatia's Telestra Tradeplace Pvt Ltd.

    The carrier will now have to approach the aviation regulator Directorate General of Civil Aviation (DGCA) for further clearances.

    "AirAsia will now have to take necessary licence etc. from DGCA," the official added.

    This would be the first entry of a foreign carrier in the domestic aviation sector after the liberalisation of FDI policy in September last year.

    AirAsia is looking to start flying from this year-end with 3-4 planes and an initial investment of about USD 50 million by the Malaysian budget carrier.

    The proposed joint venture will operate from Chennai and will focus on providing domestic connectivity to tier-ii and tier-iii cities.

    As per current rules, a carrier must complete five years of domestic operations before becoming eligible for starting overseas flights.

    Tata Sons, the holding company of the USD 100 billion salt-to-software conglomerate, will hold 30 per cent in the joint venture but will not have any operating role in the airline.

    This will mark the return of Tatas to aviation sector. State-owned Air India had grown out of Tata Airlines, which began flights in 1932.

    AirAsia, through its operations based in Thailand and Malaysia, flies to Chennai, Bangalore, Kochi, Tiruchirappalli and Kolkata in addition to 20 countries.

    AirAsia, Tatas and Hindustan Aviation of Bhatias have signed a partnership agreement for the venture.

    Air Asia has made the move to invest even as Etihad and Jet Airways continue to work towards finalising a deal for the Gulf carrier to invest in Jet.


    AirAsia-Tata joint venture gets govt's nod to start new airline - The Times of India
     
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  3. Coalmine

    Coalmine Regular Member

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    Re: Tata Group - AirAsia Malaysia JV gets govt's nod to start new Airl

    Last time ratan tata was not given license which he later complained that he was asked a bribe.This time should not be a problem
     
  4. arya

    arya Senior Member Senior Member

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    Re: Tata Group - AirAsia Malaysia JV gets govt's nod to start new Airl

    well that good news, more company should invest
     
  5. amoy

    amoy Senior Member Senior Member

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    Sometimes wonder how budget airlines survive. Once Air Asia promoted at less than usd20 for flight to BKK.

    Sent from my 5910 using Tapatalk 2
     
  6. Daredevil

    Daredevil On Vacation! Administrator

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    Re: Tata Group - AirAsia Malaysia JV gets govt's nod to start new Airl

    LCCs work based on full loading factor, faster turn around times, fuel efficiency and fuel saving techniques, cut-down middle men like ticket agents, no physical ticket selling offices but only online ticket selling, charging extra for checking luggage, no refreshments, fewer cabin crew, fewer ground handling agents, cheaper upholstery and so on and so forth.
     
  7. amoy

    amoy Senior Member Senior Member

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    ya to add a bit - refreshments and souvenirs are sold on flights. seats far less spacious than usual.

    as for on-line ticket selling it's being done for most airlines nowadays

    Sent from my 5910 using Tapatalk 2
     

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