Malaysia-based AirAsia has been granted approval by India’s Foreign Investment Promotion Board to set up an Indian budget airline. This comes after the Indian government opened up the country’s aviation industry to foreign investors in September last year.
AirAsia plans to run the new airline in partnership with Mumbai-based Tata and Indian investor Telestra Tradeplace. The new carrier would be based in Chennai in southern India and would be operated by AirAsia. Under the proposed deal, AirAsia would own 49% of the new airline, with the two Indian companies sharing the remaining stake.
AirAsia must now get the necessary licences from India’s aviation regulators. The airline already operates flights into Indian cities, including Bangalore, Kochi and Chennai.