The government of India has recently decided to allow foreign direct investment (FDI) in the country's aviation sector.

More concretely, the government has confirmed that foreign investors that are not airline companies are allowed to own 100% of the shares of Indian carriers, extending the limit from the previous 49%. However, the current ceiling of 49% for foreign airlines’ investment in domestic carriers will continue to be applied.

The new regulation includes a necessary approval from the Indian government for any investment above 49%. 

Additionally, the rules restricting foreign investment in Indian brown-field airports have also been modified. The changes will allow full foreign ownership of these facilities. 

In early June we reported that the Government of Karnataka (India) issued a Request for Proposal (RFP) for the Shivamogga airport project. The new facility will be developed under the PPP model on design, build, finance, operate and transfer (DBFOT) basis.