WATCH: Foreign player takes interest in buying 49% stake in Air India

An unnamed foreign player has expressed keen interest in buying 49% stake of the national carrier, Air India. Sources said that the foreign player may be an airline as the government had eased the foreign direct investment policy earlier in January.

Singapore Airlines via Tata Group was looking to pilot Air India. Its JV airline with Tatas, Vistara, has an "open mind" for Air India, a source was cited by a report in Times of India.

Qatar Airways is another foreign player that had expressed interest in the national carrier. Though the preferred partner airline for Qatar Airways' was IndiGo, the latter is adequate funded and has not said yes to the Qatar’s offer.

Foreign airlines have now been allowed to invest up to 49% under approval route in Air India, the Cabinet said on January 10.

“As per the extant policy, foreign airlines are allowed to invest under government approval route in the capital of Indian companies operating scheduled and non-scheduled air transport services, up to the limit of 49% of their paid-up capital. However, this provision was presently not applicable to Air India, thereby implying that foreign airlines could not invest in Air India,” the Cabinet said.

It has now been decided to do away with this restriction and allow foreign airlines to invest up to 49% under approval route in Air India subject to the conditions that:

1. Foreign investment(s) in Air India including that of foreign Airline(s) shall not exceed 49% either directly or indirectly

2. Substantial ownership and effective control of Air India shall continue to be vested in Indian National.

"The process of disinvestment is proceeding expeditiously," Civil Aviation Secretary R N Choubey was cited in a PTI story.