Prime Minister Mammohan Singh is pushing to allow foreign airlines to invest in local carriers.

Singh wants to lift a ban on foreign airlines investing in their Indian peers to attract more funds and raise operating standards, the newspaper said, adding the proposal was to allow at least 26 per cent of foreign direct investment (FDI).

The commerce and industry ministry is set to release a series of discussion papers over the coming months to test the water on lifting investment caps, including in the politically sensitive multi-brand retail sector.