The International Air Transport Association (IATA) expects Indian airline companies to narrow their

combined loss to $400 million in 2010, Chief Executive Giovanni Bisignani said on Thursd

Private Indian airlines are now reporting profits, or at least shrinking losses. In the face of major
challenges, the Air India situation is also improving," Bisignani said.

State-run carrier Air India, which is currently going through a debt restructuring process, expects
to pare losses by around 75 percent in FY11, Chairman Arvind Jadhav had said in July.

Bisignani told reporters India's airline companies posted a combined loss of $1.7 billion in 2009.

However, Bisignani expressed concerns over the $13 billion of debt that they have.

The Geneva-based trade body, which represents about 80 percent of world carriers, had said on
Tuesday global airlines have sharply raised their forecast for industry profits this year as
recession fades -- but new capacity could cut profits as soon as 2011.

IATA had said it expects the industry to post a combined net profit of $8.9 billion for 2010
globally, more than three times the previous forecast of $2.5 billion made in June.

Bisignani said India should consider allowing foreign investment in Indian airline companies.

At present, foreign airlines are not allowed to buy stake in local carriers.

"Relying only on domestic sources limits competition and could lead to an investment gap.
Moreover, the insular approach cuts India off from global expertise and global trends," he said.

(Reporting by Anurag Kotoky; Editing by Rajesh Pandathil)

(For more business news visit Reuters India