Congress leader and Lok Sabha MP Manish Tewari on Thursday slammed the Centre’s decision to allow 100% FDI in Air India by Non-resident Indians. He raised questions on whether the government had changed the policy to benefit someone. Casting aspersions about a single NRI having money to buy 100% stake in Air India, he hinted at the possibility of money being roundtripped through a front. Earlier, the NRIs were allowed to buy up to 49% of Air India.
Terming this as a “milestone” move, Union Environment Minister Prakash Javadekar on Wednesday stated that this would pave the way for fresh investments. Moreover, he contended that the passengers would continue to get better services. Writing on Twitter, Union Home Minister Amit Shah opined that this would lead to an increase in FDI inflow and employment.
On Wednesday, Prakash Javadekar remarked, “Today’s decision of Air India also is one milestone decision where NRIs who are Indian nationals will get permission to invest 100% in Air India. And this will pave the way for fresh investments. Passengers will continue to get better and better services. And, at the same time, this will improve the overall atmosphere of investments.”
In another important decision, Modi govt has today approved amendment to the extant FDI Policy, which permits Foreign Investment(s) in Air India by NRIs, who are Indian Nationals, upto 100%. This decision will lead to inflow of FDI and growth of investment, income and employment.— Amit Shah (@AmitShah) March 4, 2020
The Union Cabinet's decision comes at a juncture when the Centre has announced the sale of its 100% stake in debt-laden Air India. The government has set the deadline for submitting Expression of Interest as March 17, 2020. As per the bid document, a debt of Rs. 23,286.5 crore would remain with Air India and Air India Express at the time of closing of the disinvestment.
This is the second occasion on which the Centre has formally proposed selling a stake in Air India. In 2018, the government not only sought to sell 76% equity share capital of Air India but also invited the private sector to take control of the management. However, the proposal failed to attract any bidders.