NEW DELHI: Qatar Airways is reviewing plans for its own domestic Indian airline due to “confusing” foreign ownership rules and could work with a partner in India or take a stake in IndiGo instead, its chief executive said on Tuesday.
The state-owned Gulf carrier has long coveted the Indian aviation market, which is the fastest growing in the world, and in 2017 said it would set up a domestic airline, a year after India eased foreign investment rules for the sector.
“We are really very interested to launch an airline in India, but the regulation is a little bit confusing to us,” Qatar Airways CEO Akbar Al-Baker told reporters in New Delhi.
India now allows 100 percent ownership of India-based airlines, up from 49 percent, but only with government approval. Meanwhile, foreign airlines continue to be limited to 49 percent ownership.
Qatar Airways planned to own a minority stake of the domestic airline with sovereign wealth fund Qatar Investment Authority (QIA) being the majority owner.
However, enquiries to start the application process in India were rejected over QIA’s ownership of Qatar Airways, Baker said.
“We really don’t know what is allowed,” he said.
Qatar Airways could now work with an Indian partner for the domestic airline or alternatively seek a 15 to 25 percent stake in low cost airline IndiGo. If both of those failed then the airline would have to forget about the domestic market, Baker said.
Qatar Airways has been interested in investing in IndiGo for several years, though never bought into the airline.
Qatar Airways would be interested in buying Air India which the government wants to sell a 76 percent stake in, Baker said, adding it would only want the core airline assets and not other parts of the business such as ground handling services.
Any bid for Air India would be dependent on working with a strong Indian partner, Baker said, adding that the airline’s debt was not an issue. India wants to offload about $5.1 billion of Air India’s debt.
“The (Air India) debt can be taken and restructured. The issue is with whom we will partner.”
Qatar Airways expects to release its annual results in two weeks’ time, Baker said. He has previously said the airline made a “substantial” loss, which it blamed on a regional dispute that has banned the airline from four Arab countries.
Qatar Airways rethinks Indian plans due to foreign ownership rules
Qatar Airways rethinks Indian plans due to foreign ownership rules
- India now allows 100 percent ownership of India-based airlines, up from 49 percent, but only with government approval
- Qatar Airways has been interested in investing in IndiGo for several years, though never bought into the airline
Closing Bell: Saudi main index rises to close at 11,251
RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Thursday, gaining 84.27 points, or 0.75 percent, to close at 11,251.81.
The total trading turnover of the benchmark index was SR5.38 billion ($1.43 billion), as 188 of the stocks advanced and 67 retreated.
Similarly, the Kingdom’s parallel market Nomu gained 157.22 points, or 0.67 percent, to close at 23,643.74. This comes as 44 of the stocks advanced while 32 retreated.
The MSCI Tadawul Index gained 10.88 points, or 0.72 percent, to close at 1,517.43.
The best-performing stock of the day was Saudi Kayan Petrochemical Co., whose share price surged 9.96 percent to SR5.30.
Other top performers included Ataa Educational Co., whose share price rose 9.94 percent to SR57.50, as well as Rabigh Refining and Petrochemical Co., whose share price surged 5.74 percent to SR7.55.
Saudia Dairy and Foodstuff Co. recorded the most significant drop, falling 5.93 percent to SR220.50.
Abdullah Saad Mohammed Abo Moati for Bookstores Co. also saw its stock prices fall 2.77 percent to SR43.56.
Zahrat Al Waha for Trading Co. also saw its stock prices decline 2.30 percent to SR2.55.
On the announcement front, Multi Business Group Co. reported its annual financial results for the year ended Dec. 31. According to a Tadawul statement, the firm recorded a net profit of SR352,172 during the year, down 98 percent from the previous year.
The company attributed the decline primarily to a 2 percent drop in building contracting revenues and a 73 percent decrease in gross profit.
Multi Business Group Co. ended the session at SR9.90, down 1 percent.
Hamad Mohammed Bin Saedan Real Estate Co. announced the signing of a memorandum of understanding with Saudi Awwal Bank to enhance collaboration in financing solutions, advance real estate development projects, and expand access to customer financing programs.
Hamad Mohammed Bin Saedan Real Estate Co. ended the session at SR6.67, up 1.21 percent.
