Due to economic turmoil in India, the region has been slow to grow with the aviation times but, airline giants such as Singapore Air (SIA) are moving India’s air travel into the 21st century.
In conjuntion with Tata Sons within India, SIA declared yesterday they are developing a full-service airline which will be rooted in New Delhi.
Ownership of the new airline places SIA at 49% and Tata Sons at 51%. The plan is currently awaiting regulatory approval from entities such as the Foreign Investment Promotion Board in India.
Goh Choon Phong, Chief Executive of SIA said they are looking forward to the new venture.
“We have always been a strong believer in the growth potential of India’s aviation sector and are excited about the opportunity to partner Tata Sons in contributing to the future expansion of the market.”
“Tata Sons is one of the most established and respected names in India. With the recent liberalisation, the time is right to jointly bring consumers a fresh new option for full-service air travel,” Mr. Phong said.
Prasad Memon, Chairman of India’s latest airline is optimistic of it’s expansion.
“We now have the opportunity to launch a world-class full-service airline in India.”
Domestic services will jump-start the new SIA/Tata Sons airline group, so says a representative from SIA.
“We would like the airline to operate international services but that will depend on obtaining further regulatory approvals.”
Mahantesh Sabarad, Analyst for Fortune Equity Brokers, always believed that Tata Sons would venture into the aviation world.
“Maybe their ambitions have been renewed after India relaxed investment norms for the aviation sector last year.”
Mr. Sabarad believes SIA “would be keen to be in India” because of its probable long-term expansion.
A second airline venture is about to take off. Back in March, AirAsia saw action with Tata Sons and Arun Bhatia, who is a capitalist and proprietor of Telstra Tradeplace, as they set up a joint airline business enterprise.
Tata Sons will own 30%, Telstra at 21% and AirAsia will possess 49% of the airline company.
In an effort to rejuvenate India’s economic structure, other countries have been widely interested in sinking big dollars into India’s economy since the Indian government began permitting foreign regions to acquire up to 49% of India’s domestic aviation operations.
The outside investments go hand-in-hand as India’s government need foreign backers to support growth and development.
Based on India’s six chief airlines; Kingfisher Airlines has been grounded due to cash woes and, budget-friendly IndiGo, which is privately owned, pulled a profit out if its cockpit in March 2012.