The proposed Jet-Etihad deal may be further delayed, as the Foreign Investment Promotion Board (FIPB) has not listed it for the July 5 meeting.
The FIPB, in its last meeting on June 14, had deferred the proposal. Economic Affairs Secretary and the Chairman of this inter ministerial body Arvind Mayaram had said that the proposal was deferred as the board sought more details on “effective control” and ownership.
Etihad has proposed to buy 24 per cent stake in Jet Airways for Rs 2,058 crore.
Although the preliminary agenda for July 5 has not included Jet’s proposal among 30 items listed, Finance Ministry officials did not rule out an additional agenda which can be announced any day before or on the day of the meeting.
The DIPP is already working on a Cabinet note defining “control” and “effective control” to remove ambiguities in the FDI policy and make it easier for the Government to take a decision on the Jet-Etihad proposal.
Prime Minister Manmohan Singh has called a meeting of senior Cabinet Ministers in the first week of July to discuss tricky issues related to FDI including caps. Defining “effective control” may also be discussed at the meeting and a decision taken.
The Jet-Etihad deal involves the biggest foreign investment in the airlines sector. Any foreign investment which are to be brought under approval route has to be placed before the FIPB first.
This is the second deal involving foreign airlines after AirAsia’s proposal to set up a domestic airline in association with Tata and Telestra Group. The AirAsia-Tata proposal has already been cleared by the FIPB and is now in the process of getting the required approval from the Civil Aviation Ministry.
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amiti.sen@thehindu.co.in