Indian government wants Airbus order reviewed

15th July 2005, Comments 0 comments

NEW DELHI, July 15 (AFP) - India's government wants a planned USD 2.2 billion deal for the purchase of 43 passenger aircraft with European plane maker Airbus for state-run domestic carrier Indian Airlines re-examined, the aviation minister said Friday.

NEW DELHI, July 15 (AFP) - India's government wants a planned USD 2.2 billion deal for the purchase of 43 passenger aircraft with European plane maker Airbus for state-run domestic carrier Indian Airlines re-examined, the aviation minister said Friday.

The Indian Airlines board has already cleared the acquisition of 20 Airbus A-319s, 19 A-321s and four A-320s but the finance ministry is not satisfied the price is the best possible and has blocked the deal.

Civil Aviation Minister Praful Patel now wants a committee of experts to be appointed by India's prime minister to re-examine the issue.

"I will write to Prime Minister Manmohan Singh after he comes back from the United States and then he may appoint a committee," Patel told AFP.

The minister said the effort is to ensure "absolute transparency" in the negotiation of prices.

Singh is slated to visit the United States from July 18 to 20.

The proposal to buy the 43 Airbus aircraft has been under discussion for the past two years as it requires clearance from several layers of the government due to the size of the order.

Delays were compounded when the Congress-led government, which came to power in May last year after toppling the ruling Hindu nationalists, asked Indian Airlines to start the process afresh.

Indian Airlines mainly flies to destinations within India but it also has flights to nearby countries as well as to the Middle East and South East Asia.

The carrier was the nation's largest domestic airlines until three to four years ago but has lost market share to private airline Jet Airways, which has one of Asia's newest Boeing fleets.

Industry officials say Indian Airlines has lost even more market share in the past two to three months due to the takeoff of a number of low cost airlines in India's domestic skies.

Copyright AFP

Subject: French news

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