India's civil aviation minister has given his conditional backing to a wide-ranging alliance between Jet Airways and Kingfisher Airlines.
Praful Patel said at the India Aviation 2008 show in Hyderabad today: "If it is within the existing legal framework the ministry has no problems."
He added that he welcomes the plan by the two privately owned airlines to codeshare and interline on their respective flights, saying: "This exists internationally. There is no reason why it should not exist in India as well."
The two rival carriers announced plans earlier this week for a tight co-operation pact that will include codesharing and joint operations. It does not include equity ties.
India's airlines have been facing severe financial difficulty in recent months after several years of aggressive growth.
The Government recently set up a committee to study ways to help the sector and Patel says a plan to assist airlines could be unveiled soon.
Patel has already said a financial assistance package is being looked at for Air India and he said today that the Government is "obliged to help" as it owns the airline.
He says while it is "not as obliged to help the private airlines", options for assistance include putting pressure on state governments, oil companies and airports to reduce taxes and charges, in addition to speaking with financial assistance to find ways they may be able to assist airlines.
Patel also says India's airlines should look to make further capacity cuts to help reduce losses.
"Airlines should revisit their expansion plans to see whether this is feasible for them," he says.