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non-resident Indians - Shanmugam IAS academy in coimbatore
Air India

NRIs TO TAKE 100% IN AIR INDIA

What’s in News?

The Union Cabinet approved the proposal to allow non-resident Indians (NRIs) to acquire 100% stake in national carrier Air India.

Background:

The government in January had invited expressions of interest from investors for its entire stake in Air India, along with subsidiary, Air India Express, as well as 50% stake in Air India SATS Airport Services Pvt. Ltd, a joint venture between Air India and Singapore Airport Terminal Services.

Key data’s:

  • Full FDI: The Union Cabinet has decided to allow Non-Resident Indians (NRIs) who are Indian nationals to own up to 100% stake of Air India, which is bound for disinvestment.
  • The Union Cabinet chaired by the Prime Minister Modi has decided to increase the maximum stake for NRIs from 49% to 100%.
  • Announced by: It was announced by Shri Prakash Javadekar, Union Minister.
  • Aim: The move is aimed at liberalising FDI policy.
  • The amendment was meant to liberalise and simplify the FDI policy to provide ease of doing business in the country
  • The government is in the process of selling the national carrier, having invited preliminary bids recently.
  • The FDI (foreign direct investment) policy would be amended to allow NRIs who are Indian nationals to own up to 100% of Air India ‘under automatic route’, a government statement said.
  • By doing so, the passengers will continue to get better and better services and it will also improve the business environment

Data to know:

  • While FDI inflows stood at $45.15 billion in 2014-2015, the provisional figures for FDI have increased to $62 billion in the financial year 2018-2019.
  • As per the Remittance Report of the World Bank, India is the highest receiver of remittance (USD 79 bn) in the year 2018.

WHO IS NRI?

  • An Indian citizen who is ordinarily residing outside India and holds an Indian Passport.
  • A person is considered NRI
    • if He / She is not in India for 182 days or more during the financial year (or)
    • if he/she is in India for less than 365 days during the 4 years preceding that year and less than 60 days in that year.

Links to note:

https://www.iasipstnpsc.in/nri-wives/

https://www.livemint.com/news/india/government-to-allow-nri-s-to-acquire-100-stake-in-air-india-11583316245212.html

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