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Give ownership undertaking to fly abroad, govt to AirAsia India

Under the SOEC clause, an airline must have its operational base in India and twothirds of its board members need to be Indian along with the chairperson.

, ET Bureau|
Sep 24, 2019, 11.49 PM IST
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AirAsia India has more than 20 aircraft and over five years of local flying experience.
NEW DELHI: Amid AirAsia India’s continuing court war, the aviation ministry has asked the airline to give an undertaking that its operations are managed locally, and that it has complied with the substantial ownership and effective control (SOEC) clause.

Sources said that it would be an assurance of sorts to the government that the airline is managed locally. “With the undertaking, the government is likely to award foreign flying permissions to AirAsia India, most likely after September 26, the next date of hearing in a case filed by BJP MP Subramaniam Swamy,” a source said, refusing to be identified.

Swamy had moved the Delhi High Court, challenging the airline’s foreign flying rights, saying it was in violation of the foreign direct investment norms.

Under the SOEC clause, an airline must have its operational base in India and twothirds of its board members need to be Indian along with the chairperson. AirAsia India, which is 51% owned by the Tata group and 49% by AirAsia Berhad, has Indian nationals as its chairman, chief executive officer and on key positions.

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Despite a blanket approval from a ministerial group, the aviation ministry has not allowed AirAsia India to fly international because of the court case and also a query raised by the PMOafter Swamy moved court. The aviation ministry has replied to the query, detailing the facts about the airline.

Vistara has been allowed to fly international under the new, relaxed foreign flying eligibility norms but AirAsia India was eligible even under the earlier, stricter rules.

The earlier rules required Indian carriers to have a fleet of 20 aircraft and five years of domestic flying experience. This was eased to zero domestic flying experience and 20 aircraft in the fleet, known as 0/20 rule, in 2016.

AirAsia India has more than 20 aircraft and over five years of local flying experience.

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