The Indian government has given the go ahead for the development of an indigenous airliner, a project that has been in limbo for years.
"The high level committee on manufacturing took a major strategic decision for the development of a civil aircraft, of a 70-90 seater range to begin with, in India," a statement from the prime minister's office said.
"This is a strategic sector where there is a need to have a presence in the long term, particularly in view of the rapid growth of our aviation sector," it added.
A special purpose vehicle will be set up for the development and production of the aircraft programme.
While the design capabilities of state-owned airframer Hindustan Aeronautics Ltd (HAL) and research and development agency National Aerospace Laboratories (NAL) will be tapped on for the development of the aircraft, the country also expects to collaborate with companies in India's private sector as well as overseas institutions on the project.
"Efforts will be made to leverage the offsets that are available in the defence sector for building critical domestic capabilities in high precision manufacturing and avionics," the statement said.
A "high level steering group" will also be set up to work out details of the programme. At this point, it is unclear whether the aircraft will be a turboprop or a jet.
The proposal for India to develop its own regional transport aircraft programme first surfaced in 2007. Both HAL and NAL then undertook separate studies and a 16-member committee - including officials from HAL, NAL, the civil aviation ministry, research bodies and some Indian industrialists - was also formed.
Initial discussions centred around a 70-90 seat aircraft with a range of 1,350nm (2,500km). A composite airframe was also proposed along with an indigenous fly-by-wire control system.
The project has however been in limbo for years, and NAL told Flightglobal Pro in an interview last year that financing considerations have been a major reason for the delay.
NAL forecasts demand for up to 500 regional transport aircraft in India.
If developed, the new aircraft will enter a crowded field, potentially competing with aircraft such as the Mitsubishi MRJ regional jet, Embraer 190 E2, and Bombardier CS100.