British Airways-Iberia could buy Indian airline

LONDON - British Airways has indicated that it may buy an Indian airline following its merger with Spain’s Iberia.

British Airways CEO Willie Walsh speaking in the Indian city of Mumbai, said he would not dampen speculation International Airlines Group (IAG) - to be formed from the merger of BA and Iberia - would be interested in investing in the Indian market.

And the embattled chief executive - who faces a Christmas strike threat in the UK - went a step further, praising Kingfisher, the Indian airline owned by beer magnate Vijay Mallya, as “clearly the best partner” in the former British colony. But Mr Walsh warned that Indian regulators will need to relax the rules in order for such an tie-up to occur, given current onerous investment restrictions.

“I can certainly let you speculate that IAG will be interested in investing in the Indian market,” he added, before saying that he saw the agreement with Kingfisher as the start of a “long and successful relationship”.

According to The Telegraph, presently, strict Indian laws make it impossible for a foreign airline to even become a minority investor in a domestic Indian airline, however foreign companies outside the industry can buy up to an 25pc stake.

Changes to the restrictions were discussed as recently as two years ago, although it is not thought there are any current plans to relax the rules. (ANI)