AirAsia’s decision comes in the wake of India easing the foreign direct investment (FDI) rules on domestic carriers. 

So far, no airline has bought a stake in a local carrier since the government relaxed the FDI policy.

In September, the government allowed overseas airlines to pick up a stake of as much as 49% in domestic carriers. The AirAsia proposal also comes as United Arab Emirates carrier Etihad Airways PJSC is inching towards buying a 24% stake in Jet Airways (India) Ltd.

According to estimates by aviation analysts, the AirAsia Group ended 2012 with a fleet of 120 Airbus A320s, including two aircraft acquired on an operating lease from Airbus. The fleet includes 64 A320s at AirAsia Malaysia, 27 at Thai AirAsia, 23 at Indonesia AirAsia, four at AirAsia Japan and two at AirAsia Philippines.

AirAsia A320 photo: Airbus