Sept. 21--The civil aviation ministry on Friday cleared AirAsia's proposal to start an airline in India with Tata Sons Ltd , eight months after the airline sought permission from the India government.
"The proposal has been cleared. AirAsia has been granted a no objection certificate (NOC)," a senior aviation ministry official said late Friday evening.
Civil aviation minister Ajit Singh cleared the proposal on Friday afternoon -- within a week of the airline receiving the home ministry's clearance.
The airline will now apply to aviation regulator Directorate General of Civil Aviation (DGCA) for an airline licence, after which it can start flights.
The NOC means the airline can also now start importing Airbus A320 aircraft to its base in Chennai.
The airline wants to start flights this fiscal.
AirAsia had received a formal approval from the Foreign Investment Promotion Board (FIPB) to launch an airline in the country in association with the Tatas recently.
AirAsia India is a new airline company in which Malaysia's AirAsia Bhd has a 49% stake, Tata Sons has 30%, and Arun Bhatia's Telestra Tradeplace Pvt. Ltd owns the rest.
Currently, AirAsia operates in Thailand and Malaysia and already connects Chennai, Bangalore, Tiruchirappalli, Kochi and Kolkata to the Association of Southeast Asian Nations (Asean) and beyond.
Tata Sons on Thursday announced that they plan to launch another airline with Singapore Airlines and have sent their own application to the government for clearance. Tatas will own a 51% stake in this venture.
The clearance of the AirAsia proposal, one of the fastest such clearances in recent times, comes despite the airline already running into rough weather.
The Delhi high court had on Wednesday admitted a petition by Bharatiya Janata Party (BJP) leader Subramanian Swamy seeking to quash the clearance granted to AirAsia India Pvt. Ltd to start an airline, claiming that the government had overlooked several issues related to foreign control and policy in giving its approval.
The court has given the government four weeks to respond to the petition and this could lead to a delay in the launch of the new airline which was widely expected to start this fiscal and help stem high fares.
The bench of Chief Justice N.V. Ramana and Justice Pradeep Nandrajog asked the government to "file an affidavit explaining the government's policy on the issue" in four weeks.
The four respondents are the Union government, FIPB, commerce and civil aviation ministries. InterGlobe Aviation Pvt. Ltd-run IndiGo, Go Airlines (India) Ltd and Kingfisher Airlines Ltd had also considered a move, under the aegis of airline lobby group Federation of Indian Airlines, to write to the government and oppose the policy of foreign airlines investing in start-ups, but gave up the idea after no consensus emerged among the Indian airlines, Mint reported on 7 August. This was largely seen by analysts as a move aimed at stopping AirAsia's entry into India. Jet Airways (India) Ltd, Air India Ltd and SpiceJet Ltd had not supported the move.
Copyright 2013 - Mint, New Delhi
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