"Industrial conglomerate Tata Sons and Singapore Airlines had signed a memorandum of understanding (MoU) in September 2013 to launch an airline by investing $100 million and had sought the FIPB's approval. "
New Delhi, July 10 - The aviation regulator Thursday dismissed demands not to grant a licence to the Tata-Singapore Airlines joint venture.
The Directorate General of Civil Aviation (DGCA) chief Prabhat Kumar dismissed the demand raised against granting of schedule operators' licence to the proposed JV company.
The Federation of Indian Airlines (FIA) had written to DGCA when it issued a public notice inviting objections or suggestions regarding grant of permit to TATA-SIA Airlines.
The DGCA issued the public notice after the proposed airline got its initial NOC (no objections certificate) from the Civil Aviation Ministry and submitted an application for issue of air operator permit (scheduled) licence (AOP) on April 22, 2014.
This is the second instance in which DGCA had invited public comments before issuing a licence. It had previously done so for AirAsia India.
The objections to the new airline ranged from new FDI (foreign direct investment) norms to substantial ownership and effective control of the JV.
The DGCA rejected the demand stating that the government has already made it clear that the policy is meant for starting new airlines as well.
The DGCA further pointed out that the new JV is registered in India and that its chairman and at least two-third of boards are Indian citizens confirming that the ownership and effective control is vested with Indian nationals.
However, DGCA further said that this decision is subjected to any interim or final order of the Delhi High Court which is hearing a case against the proposed JV airline.
DGCA will now also have to check issues relating to the fleet size, parking space, operating slots and routes dispersal before granting the AOP.
The JV was approved by the Foreign Investment Promotion Board (FIPB) in October 2013.
Industrial conglomerate Tata Sons and Singapore Airlines had signed a memorandum of understanding (MoU) in September 2013 to launch an airline by investing $100 million and had sought the FIPB's approval.
On May 7, 2014, the DGCA granted the AOP to AirAsia India, a JV between Tata Sons, AirAsia Berhad and Arun Bhatia-promoted Telestra Tradeplace under the same route.