The decision to allow foreign airlines to buy stakes in domestic carriers may be delayed again. Apparently, mindful of the political opposition the decision might invite, Prime Minister Manmohan Singh has urged a fresh round of talks before the move is sealed by the Cabinet Committee on Economic Affairs (CCEA).

Even as the final Cabinet note was already prepared by the government, the decision was deferred in the CCEA meeting last week due to strong opposition, both from within and outside the government. It seems the prime minister has asked Finance Minister Pranab Mukherjee, Civil Aviation Minister Ajit Singh, Commerce & Industry and Textile Minister Anand Sharma and Home Minister

P Chidambaram to come to a “solid conclusion” before such a far-reaching policy change is undertaken, said a senior official in the ministry of commerce & industry, on the condition of anonymity. 

The official said there was still no absolute agreement on how much stake foreign airlines would be allowed to pick acquire. While the ministries of civil aviation and finance are strongly supporting a cap of 49 per cent through the automatic route, the commerce ministry is in favour of a 26 per cent one, while the home ministry is not comfortable with the automatic route and wants proper scrutiny of players who want to enter the market. The Planning Commission has also admitted there was no agreement on this issue within the government.

Another reason why the new round of talks has been called is because once the decision goes through, it is bound to invite severe wrath from various political quarters, which includes stiff opposition from West Bengal chief minister Mamata Banerjee.

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