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Friday, July 10, 1998

MPs oppose Tata Airline

PRESS TRUST OF INDIA  
NEW DELHI, July 9: More than 40 Members of Parliament belonging to various political parties today again opposed the Tatas' proposal to start a domestic airlines in India with foreign equity participation.

In a memorandum submitted to Prime Minister Atal Bihari Vajpayee, they said the introduction of the proposed airlines would "definitely have a very serious adverse impact on Indian Airlines and Alliance Air" and also defeats the government's disinvestment policy on the national carrier.

The memorandum, a copy of which was released to the press, was signed by among others Gurudas Das Gupta (CPI), Ram Gopal Yadav, Ish Dutt Yadav (both SP), Dipankar Mukherjee (CPI-M) and B S Ramoowalia (independent).

The MPs said before considering the Tatas' proposal, the Ministry of Civil Aviation and the Directorate General of Civil Aviation should ensure that the proposal was in compliance with the guidelines for foreign equity participation in the aviation sector which were issued by the government on June12.

Only last month 35 MPs had submitted a similar memorandum to Industry Minister Sikander Bakht opposing the Tata proposal.

The MPs have urged the Prime Minister to issue appropriate instructions to the civil aviation ministry to ensure that the planned technical services agreement between Tata Airlines and Singapore Airlines was not used as a vehicle for the entry of a foreign airline into the domestic aviation sector.

They conveyed their concern about the ``indecent haste'' that was being shown by the Foreign Investment Promotion Board (FIPB) in approving a proposal from the Tatas, and the ``adverse impact'' it could have have on the performance of the national carriers.

They said media reports on July 2 and 3 had said that the civil aviation ministry had cleared the Tata Airlines proposal and it was being put up to the FIPB for approval at its meeting on July 11. Tata Airlines had also been invited to attend the next meeting of aviation ministry's aircraft acquisition committee, they said.

FIPBhad postponed a decision on the airline last month.

The MPs had said before serious consideration is given to the Tata Airlines proposal, a professional and detailed study should be carried out on the likely impact of the entry of a major airline like Tata on Indian Airlines and Alliance Air.

They had suggested that the report should be submitted to parliament and the matter discussed before a final decision is reached about the proposal. The entry of a big, private airline would divert a lot of traffic from the national carriers, lead to a drop in its load factors and drive Indian Airlines into a loss making situation and that too at a time when it had just managed to turn the corner, the MPs said. It would also defeat the government's disinvestment policy about the domestic national carrier, they added.

Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.


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