Singapore Airlines has won the Indian Foreign Investment Promotion Board's approval to set up a full-service airline in the country in a joint venture with Tata Group, a senior finance ministry official said.
Economic Affairs Secretary Arvind Mayaram, who was speaking to reporters after a meeting of the FIPB on Thursday, did not give further details.
Singapore Airlines will make an initial investment of $49 million for a 49 percent stake in the joint-venture company, while the Tata Group will initially invest $51 million for the remaining stake, the companies have said.
The Tata Singapore Airlines JV airline needs a slew of other regulatory approvals before it can start operations.
Ratan Tata, SIA chief meet Chidambaram
Ratan Tata, Tata group Chairman Emeritus and Goh Choon Phong, CEO, Singapore Airlines today called on Finance Minister P Chidambaram.
They discussed the Tata-SIA join venture for launching a full service airline, sources said.
The meeting took place hours after the Foreign Investment Promotion Board (FIPB) gave its approval to Singapore Airlines to invest USD 49 million for starting a full service airline joint venture with Tata Sons. The initial investment in the airlines envisaged at USD 100 million.
After meeting Chidambaram, Tata told a television channel that he was excited about getting FIPB approval and said lots of work was needed to be done to start the venture.
This is Tatas' second venture in the aviation sector after its tie-up with Malaysian carrier Air Asia in February for a low-cost passenger air service.