AirAsia plans India airline with Tata
BY BLOOMBERG NEWS
Thursday, February 21, 2013
2/21/13 at 3:16 AM
AirAsia Bhd., Southeast Asia's biggest budget airline, plans to start a venture in India with Tata Group after the government eased rules to lure investment in a country where air travel is set to triple.
AirAsia applied Wednesday to India's Foreign Investment Promotion Board to take 49 percent in a venture with Tata Sons Ltd., owners of Jaguar Land Rover luxury vehicles, and Arun Bhatia of Telestra Tradeplace Pvt. Subject to an approval, the partners will then seek an air operators permit, the airline said.
The move will help AirAsia get an entry into a nation where economic growth is encouraging more people to ditch trains for planes, helping triple the number of domestic air travelers to 159 million annually by 2021, according to India government estimates.
To help an industry mired in debt and losses, Prime Minister Manmohan Singh's government in September eased foreign investment rules prompting Jet Airways (India) Ltd. to start discussions with the Middle East's Etihad Airways.
AirAsia is among the 50 low-fare airlines that started in the Asia-Pacific region in the past decade to compete with full- service carriers as first-time travel surges in India, Indonesia and other developing economies.
The new airline plans to operate from Chennai in South India.
Original Print Headline: AirAsia, Tata planning new airline for India