The Tata-Singapore Airlines joint venture hopes to start flying by June, the airline’s Chairman, Prasad Menon, said on Friday, a day after the proposal was cleared by the Foreign Investment Promotion Board (FIPB).
“We are looking for a very fast process and hope by May or June we will start the new airline,” Menon told newspersons after a meeting with Civil Aviation Minister Ajit Singh.
Tata Sons holds a 51 per cent stake while Singapore Airlines has taken up the rest of the equity in the new full-service airline.
The two partners signed a Memorandum of Understanding in September and immediately applied to the FIPB for permission to establish the airline.
The decision to set up a new airline came within months of the Centre reversing its earlier decision to not allow foreign airlines to acquire a stake in domestic airlines.
Menon was accompanied by Goh Choon Phong, CEO of Singapore Airlines, Ratan Tata, Chairman Emeritus of Tata Sons, and other senior officials.
The team also met Commerce and Industry Minister Anand Sharma.
Menon said that the company was “still working on and was yet to take a decision” on what kind of aircraft it will operate. Asked whether Tata-SIA plans to take aircraft on lease from Singapore Airlines, Menon said, “It is a possible option.”
The Civil Aviation Minister said he “did not see any problem” in the airline starting operations as FIPB had cleared the proposal.
“Basically they have to satisfy the Directorate General of Civil Aviation on a lot of things. A lot of paperwork, testing, pilots, manuals, routes, etc. It depends on how fast they provide that data,” Singh said.
Asked to comment on SIA starting an airline in India before launching one in China, Goh merely said, “We have been a strong believer in the Indian market.
“We believe that the potential is enormous and we are very privileged to have this opportunity to contribute to the growth.”
Tata said he was “very pleased” that the Minister had opened up the aviation sector. “It is our responsibility to make him proud of what he has approved. “I hope we can make a big difference.”
‘Will be happy to look at stake in Air India’
Over a decade ago – in December 2001 - Tata Sons had formally communicated to the Government its decision to opt out of the race for a stake in Air India. Coming full circle, on Friday, Ratan Tata, Chairman Emeritus, Tata Sons, said, “As and when Air India is privatised, we will be very happy to look at it.”
The Tatas, along with its partner Singapore Airlines (SIA), was the lone bidder in the fray for a stake in the state-owned Maharaja in September 2001. However, by December 2001 the Government had decided to go slow on the disinvestment plan.
The Tatas’ plans of entering the aviation sector in India hit another air pocket when SIA withdrew from its partnership with the Group. The Tatas had assessed the situation with an “open mind” and tried to rope in a new global partner, which did not materialise.
Underlying the Group’s long association with Air India, the Tatas had then said in a statement, “Air India is always dear to us,” referring to the fact that the Maharaja was started by J.R.D. Tata. The airline was nationalised in 1953.