The finance ministry is in favour of allowing foreign carriers to buy up to 49 per cent in Indian carriers.
"We have replied to the note sent by the commerce ministry, favouring allowing foreign carriers to buy up to 49 per cent in Indian carriers," said a senior finance ministry official, who did not want to be identified.
The civil aviation ministry has backed the proposal. But the commerce ministry wanted a 26 per cent cap.
SpiceJet and Kingfisher Airlines support the move, while Jet Airways and IndiGo are against it.