AirAsia India silent on deal change to allow Tata Sons operational control

NEW DELHI (Dec 27): AirAsia India on Friday refused to comment on a reported change in the brand licence agreement that would give the India-based carrier's local partner Tata Sons more control over its key operations.

As the airline prepares to fly on foreign routes, the Civil Aviation Ministry of India has asked the joint venture partners to revise the agreement, theBusiness Standardnewspaper reported.

Sales and distribution, revenue management, network planning, catering, in-flight services, finance, engineering, and leasing contracts are among the areas that will now be under the sole discretion of AirAsia India rather than be subject to approval of Malaysia-based AirAsia Bhd, the report said.

"We decline to comment," an AirAsia India spokesman said when contacted byBernama.

A Tata Sons spokesperson also refused to comment on the report, which said that a draft agreement has been submitted to the Ministry of Civil Aviation.

AirAsia Bhd owns 49% of AirAsia India, while Tata Sons controls 51%.

The Indian government does not allow locally-based joint ventures to be majority-owned by foreign partners and insists on their effective control being in Indian hands.

AirAsia India's planned international services have been delayed although it has fulfilled the two main government requirements of being in operation for at least five years and a fleet of 20 aircraft.

The carrier operates a fleet of 28 aircraft.