Budget carrier AirAsia is seeking to form a joint venture to create a low fares airline in India.
The Malaysian carrier plans to use its investment arm AirAsia Investment to own 49% of the start-up carrier with the remaining stake held by two Indian firms.
The joint venture, with private companies Tata Sons and Telestra Tradeplace, plans to operate from Chennai in southern India and provide domestic flights.
AirAsia chief executive Tony Fernandes said: "We have carefully evaluated developments in India over the last few years and we strongly believe that the current environment is perfect to introduce our low fares.”
The move follows the opening up of India’a airline sector to foreign carriers last September, allowing them to purchase up to 49% of local airlines.
“AirAsia believes Indian aviation has enormous long-term growth potential and is expected to produce tremendous upside for first movers,” a statement said.
Telestra Tradeplace is an investment holding company of Arun Bhatia, according to the AirAsia statement. His son Amit Bhatia and Fernandes are directors of Premiership football club Queens Park Rangers.
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