SIA, Tata Group get approval for JV carrier registration

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India's ministry of corporate affairs has approved the setup of a new entity by Singapore Airlines and Tata Group.

The ministry gave the green light for the two companies to establish Tata SIA Airlines Ltd, which will be based in New Delhi. The application was made early this month.

This moves SIA a step forward in its proposal to set up a joint venture carrier with Tata Group, announced in September. Under the plan, SIA will take a 49% stake in the New Delhi-based full service carrier, with Tata holding the remaining shares.

The two companies still need approval from India's Foreign Investment Promotion Board before they can apply for the various necessary permits from the country's ministry of civil aviation. The board is expected to meet on 24 October to consider the proposal.

In 2012, the Indian government cleared foreign airlines to invest in local carriers and take up to a maximum shareholding of 49%. AirAsia has also applied to set up a similar joint venture carrier with Tata Sons and Telestra Tradeplace, while Etihad Airways has been approved by India's securities regulator to take a 24% stake in Jet Airways.