the approval was granted.
“A lot of work needs to be done from our end. The next step is to get a no-objection certificate for which we will apply to the aviation ministry shortly,” Tata added. Singapore Airlines, a subsidiary of Temasek Holdings, is the world’s 10th-largest carrier with revenues of $14.8 billion in 2012 and a net income of $335 million. Its initial investment in the joint venture will be $49 million of the total $100 million. SIA carried around 18 million passengers in 2012.
The arrival of the Tatas on the aviation scene will mean increased competition for Jet Airways. The two-decade-old airline recently partnered with UAE-based Etihad, which has picked up a 24% stake in it. The JV would have an edge over rivals because it can exploit 50,000 seats per week to Etihad's home base Abu Dhabi, where it can also refuel at cheaper rates. Fuel costs eat up around 40-45% of total revenues of airline companies.
This is the third foreign joint venture approved by the government since a new aviation policy announced in September 2012 allowed foreign carriers to have stakes up to 49% in Indian airline firms. The Tatas were the first to announce the JV with AirAsia in February this year.
"The airline will begin with domestic services although we would like it to also operate international services. However this will depend on obtaining further regulatory approvals,” said Nicholas Ionides, Singapore Airlines vice-president (public affairs), in an email statement.