Jet-Etihad deal under cloud; cabinet secretary to chair meeting today
Zee Media Bureau
New Delhi: The Rs 2,058 cr Jet-Etihad deal will be discussed today as cabinet secretary Ajit Seth is likely to chair a meeting of secretaries over security concerns raised by the Prime Minister’s Office (PMO).
The deal, largest foreign investment proposal in the aviation sector, is facing regulatory hurdles with various ministries raising major concerns over the ultimate control of Jet Airways post transaction.
Earlier, the Foreign Investment Promotion Board (FIPB), which clears FDI proposals, on June 14 had deferred a decision on the deal citing control and ownership issues.
Under the proposed transaction, Jet would sell its 24 percent to Etihad Airways.
Concerns have been primarily raised on the proposed ownership and control structure of the domestic airlines. Besides, capital market regulator Sebi, fair trade watchdog CCI, and Department of Industrial Policy and Promotion (DIPP) also have reservations about the deal.
Post transaction, Jet Airways promoter Naresh Goyal would directly own 51 percent in the airline.
The FDI policy for civil aviation, which was revised in September last year, allows foreign airlines and foreign institutional investors to invest up to 49 percent in an Indian airline. NRIs are already allowed 100 percent investment.
With PTI inputs