The government has decided not to allow foreign airlines to invest in local helicopter service providers, which need only an extra permission to fly airplanes in India — an area where foreign airlines are not welcomed.
This is a tightening of the foreign direct investment (FDI) policy that allows unrestricted foreign investment in helicopter services without prior approval from the government.
India has many large helicopter service providers including Pawan Hans Helicopters, Global Vectra and Jagson Airlines. The move follows a clarification the civil aviation ministry recently made to the finance ministry and the industrial policy and promotion department, that helicopter service providers having non-schedule operator permit are not prevented from importing fixed-wing aircraft or airplanes.
They only have to take permission from the government before importing, said a government official, who asked not to be named. (Unlike scheduled operators, non-scheduled operators do not publish a time table or issue tickets to passengers.)
Hence, such helicopter operators should not be considered as merely providers of helicopter service, where full foreign investment is allowed. Their non-schedule operator permit entails scope for diversification into fixed wing service.
The ministry also clarified that so far, the government has not issued any non-schedule operator permit to anyone exclusively for helicopter service, said the official.
The finance ministry and the department of industrial policy and promotion also decided that foreign helicopter service providers should be classified as foreign airlines, which are not allowed to have direct or indirect ownership in Indian airlines.
Hence, many large foreign corporations, particularly in the exploration business that have helicopter operating permits, should de-link their helicopter licence from the vehicle that is making foreign investment into Indian helicopter service providers.
The apex body that clears FDI into India — the foreign investment promotion board (FIPB) has started advising foreign investors accordingly, said the official.
Now foreign investors, excluding foreign airlines, can invest up to 49% in scheduled air transport service and up to 74% in non-scheduled air transport service without prior government approval. Non-resident Indians are allowed invest in this sector without any restriction.