'Hasty' India-UAE deal under CVC lens

The CVC has written to the civil aviation ministry asking for a factual report following allegations by Lok Sabha MP Nishikant Dubey that senior ministers had cleared the bilateral deal between Indian and UAE 'in haste' to push for the Jet-Etihad deal. Sanjib Kr Baruah and Gaurav Choudhury report.

The Central Vigilance Commission (CVC) has written to the civil aviation ministry asking for a factual report following allegations by Lok Sabha MP Nishikant Dubey that senior ministers had cleared the bilateral deal between Indian and UAE ‘in haste’ to push for the Jet-Etihad deal.

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Dubey had written to the Central Vigilance Commissionon July 6 also alleging how on March 1, 2013, the Director General of Civil Aviation (DGCA) had modified/deleted certain clauses of its guidelines issued in 2008 so as to facilitate the proposed R2,058 crore Jet-Etihad deal.

“Clause 1.7 prevented passing on of effective control of management of a domestic airline to a foreign airline, which was deleted. Clause 1.8 was modified so that a scheduled passenger airline having FDI from foreign airlines could now pass on the right to interfere in the management of the domestic airline, while clause 1.9 was modified to permit domestic airlines to receive facilities like soft loans from foreign airlines,” Dubey told HT.

In June, the Foreign Investment Promotion Board (FIPB) had deferred a decision on the largest foreign investment proposal in Indian aviation and sought more clarity on control and ownership issues after formalising of the deal.

In April, Jet Airways had announced selling 24% of its equity to Etihad Airways. This was followed by the civil aviation ministry signing a bilateral agreement to increase flights to and from Abu Dhabi.

In light of such allegations, the income tax department and the CBI is looking into the matter.

While the IT is looking into the proposed deal to check whether it is structured in a way to evade taxes as also to identify the beneficial owners, the CBI is reportedly looking into the entire gamut of allegations by Dubey.