Qatar Airways CEO, Mr. Akbar Ali Baker, on Wednesday described the proposed 26 per cent FDI limit as “too little” to offer necessary space to foreign airlines. The airways will increase Cargo operations in India also and also add two more cities in its flight map in the country.
According to Mr. Baker going ahead Indian aerospace should witness increased merger and acquisition activities in an effort to enhance the operational efficiency and growth thereby creating space for foreign players. The move should especially help the private operators by opening up opportunities for necessary fund infusion.
However, he was sceptical if the 26 per cent cap may prove a deterrent for foreign investors to take exposure in the country’s air-space.
“We (foreign airlines) need to have a bigger share. By just having 26 per cent (equity) you do not have much say in the way the company is run. So you cannot let somebody become your partner and then not let him (foreign investor) say that what you (Indian partner) are doing is not the right way,” he told Business Line.
“I think they (Indian government) should allow (raise the FDI bar) up to 49 per cent,” he added.
According to Mr. Baker, the foreign airlines would look forward to invest in Indian companies, provided they (foreign investor) have a say on the operational issues so as to ensure adequate returns (to foreign investor). “The foreign collaborator should have a say,” he said.
Qatar Airways’ picked up 35 per cent stake in Cargolux. The operational control has reportedly helped the Europe's largest all-cargo airline carrier to improve its bottomline.
India plans
Meanwhile the airline is looking forward at expanding its cargo operations in India. Qatar Airways has cargo services in six destinations including Mumbai, Kolkata, Chennai, Bangalore and Kozhikode. “We would like to increase our cargo capacities as well as request the government for an increase in passenger capacities,” Mr. Baker said.
Keywords: FDI, airline, 26%, too little, Akbar Ali Baker, Qatar Airways CEO