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Millennium Post

Cabinet to take up FDI in aviation

The agenda for the cabinet meeting scheduled for Friday includes two important  proposals of foreign direct investment (FDI), in which the government will take a call on allowing  foreign aviation players to invest in domestic airlines and if this money come in the DTH and cable TV sectors.

In all likelihood, the cabinet will relax the FDI norms for foreign airlines to make investment in Indian airlines. Currently foreign airlines are barred from buying stakes in domestic carriers, while foreign investors can hold a 49 per cent cumulative share. If the proposal is approved, then the foreign airlines would be allowed to buy similar-sized shareholdings in Indian airlines.

Merely sustaining itself, Kingfisher Airlines mooted this idea in the past as well, hoping that foreign funds would help it to revive. If this proposal is approved, this airline will be the biggest gainer. Another important proposal which will most likely be approved in the cabinet meeting is the increase in FDI cap in DTH and cable TV from 49 per cent to 74 per cent. The information and broadcasting ministry had been pushing for the increase in FDI limit in broadcast carriage services.
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