India Insight

The comma that let a Malaysian airline sneak in

(Any opinions expressed here are those of the author and not necessarily of Thomson Reuters)

AirAsia CEO Tony Fernandes has big plans for his budget airline. This week, the government approved the Malaysian carrier’s proposal to set up a new airline in India with the Tata group – and it happened thanks to a comma.

The Economic Times reported on Thursday, that the punctuation mark saved the joint venture, with India’s foreign investment regulator interpreting a 2012 ministry press note to mean foreign investments were also allowed for newly created airlines.

“The government of India has reviewed the position in this regard and decided to permit foreign airlines also to invest, in the capital of Indian companies, operating scheduled and non-scheduled air transport services, up to the limit of 49% of their paid-up capital,” the Department of Industrial Policy and Promotion said in its press note on Sept. 20 last year.

Had there been no comma after “companies”, things would have been clear. It would have meant foreign airlines could only invest in existing carriers. The newspaper reports that the ambiguous comma allowed finance ministry officials to argue in favour of the 800 million rupee ($15 million) joint venture, even though officials in the aviation ministry questioned it.

from Summit Notebook:

Paranoid governments and conspiracy theories

Adi Godrej

Adi Godrej

Adi Godrej, who marshals his namesake $2.5 billion diversified group, believes the Indian government is “paranoid” about the possible effects of allowing more foreign investments into sectors such as airlines.

“They (the Indian government) have not allowed foreign airlines to invest in private airlines, and they cite security. I don’t see what security would be compromised,” Godrej told the Reuters India Investment Summit in Mumbai.

“If British Airways or Delta got to own part of an Indian private airline, they are worried about what would happen in times of a war, etc. You are in control of your country. What can they do in difficult times to stop it?” he said.

Will rotting foodgrain bring about a retail revolution?

Pictures of grain rotting in the rain in Punjab have shocked a country reeling under high food price inflation and where hundreds of thousands go to bed every night on an empty stomach.

A labourer carries a plastic sheet to cover wheat sacks at a wholesale grain market in Chandigarh May 18, 2010. REUTERS/Ajay Verma/FilesThe estimates vary from 1.2 million metric tonnes of rice and wheat wasting in Punjab alone, and as much as 18 million metric tonnes of food grain lying in the open across the country because of inadequate storage facilities, translating into losses of about 270 billion rupees ($6 billion).

But this is not a new problem. India has prided itself on increasing agricultural productivity, but it has not invested adequately in storage and warehousing facilities, condemning some 40 percent of produce that the country can ill-afford to waste to the trash can.

Is the media going overboard in its coverage of the Ambani feud?

The war of words between the billionaire Ambani brothers took an unexpected turn when younger sibling Anil offered an olive branch to elder brother Mukesh in a bid to resolve a feud over the split of the Reliance business empire in 2005.

The widespread coverage the Indian media has given to the squabble between the brothers has led to a debate on social networking sites such as Twitter, with some accusing news organisations of playing host to a reality show or soap opera that stars the Ambani family to boost ratings.

Prominent columnist Vir Sanghvi wrote through his Twitter account virsanghvi: “Do you think some network should plan a reality show on the Ambani battle? Or are they doing it already on the news?”

Hoping for an Oxford degree in India

Now that the proverbial Left monkey is off the government’s back, the country’s education system will be among the sectors on the radar of the administration in its push for reforms.

With more than half of the billion-plus population aged 25 or below and foreign players eager to have a share of the lucrative industry by setting up branches in India, the education sector can potentially bring in a huge amount of foreign investment.

school.jpgAnd for many students who would otherwise be squeezed out of the few elite colleges or would have to study abroad, opening up the system could make world-class education available to them without having to leave the country.

  •