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This is an archive article published on April 28, 2000

Draft aviation policy to scuttle Air-India sale

NEW DELHI, APRIL 27: The latest draft aviation policy, to be finalised by aviation minister Sharad Yadav tomorrow before being presented t...

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NEW DELHI, APRIL 27: The latest draft aviation policy, to be finalised by aviation minister Sharad Yadav tomorrow before being presented to Cabinet, suggests a cap on foreign equity of 25 per cent in Air-India after its disinvestment. According to the draft prepared by the Ministry of Civil Aviation, a copy of which is available with The Indian Express, this is in keeping with the policy of many important countries such as the US, Canada, China, Japan, Australia, etc.

The draft note also proposes that NRIs be allowed to hold upto 26 per cent of Air-India’s equity after disinvestment.

Among other proposals of the ministry, all domestic carriers will get the opportunity to fly to foreign destinations. This effectively means that Indian Airlines will not be asked to withdraw from Gulf operations — a longstanding Air-India (AI) demand — and that Jet Airways and Sahara airlines can fly overseas.

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The aviation policy has been “substantially” redrafted after Minister of State for Civil Aviation, BJP’s Chaman Lal Gupta raised several objections. Gupta in his three page letter to Secretary Civil Aviation, Ravindra Gupta said: “There is no mention in the policy document about “substantial ownership” and “effective control”. It seems appropriate to prescribe the working norms in National Airlines. Besides, limiting foreign equity up to 25 percent the voting rights for foreign airlines equity may also be restricted to 25 percent so to ensure that the majority share (ie 51%) remains with the Government/Indians”.

The new policy also provides for commandeering airline resources during national emergency. The policy also says that frequent review of threat perception at various airports will be carried out taking in to account international situation, internal security and other inputs. Intelligence Bureau and Research & Analysis Wing(RA&W) to be associated with state police for this. The policy also envisages a mechanical system of unobtrusive surveillance watch in the departure lounge at the airports should be introduced and full time officials should be employed to minutely observe the behavior of the passengers. Security checks should be so organized that a minimum of 10 to 15 minutes are spent by every passenger in the departure lounge. IB should train the security staff for this purpose.

The mission statement and the objectives of the policy have been redrafted to incorporate “the need for time bound implementation of the policy with quantifiable key indices which have indicative target dates for their completion”. Now according to a note of Anurag Goel, Joint Secretary written on 22 March an action plan will be prepared for implementation of the policy. Some of the important areas where this will apply is disinvestment in AI, IA, leasing of major airports to private companies, fleet acquisition for national airlines and provision for the post of airport director.

Six major world airlines form B2B Internet marketNEW YORK: Six major world airlines announced plans on Thursday to form a new company to create and operate an Internet marketplace linking carriers worldwide with sellers of related goods and services.

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The six founding airlines are Air France, American Airlines, British Airways, Continental Airlines, Delta Air Lines and United Airlines.

The new company, to be based in the United States, will be launched formally in coming weeks, the airlines added in a statement. A technology partner will be selected later by the new company.

The amount being invested by each of the founding airlines was not announced, "although each will initially invest an amount proportionate to the equity each receives," the statement added.

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