The Telegraph
Friday , February 1 , 2013
Since 1st March, 1999
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Jet, Etihad get govt blessing

New Delhi, Jan. 31: The officials of Jet Airways and Abu Dhabi-based Etihad today met commerce minister Anand Sharma and civil aviation minister Ajit Singh to discuss the details of the stake sale deal.

Sources said the deal might be signed as early as tomorrow though top officials from the airlines remained tight-lipped.

Both the ministers have assured the carriers full government support.

Etihad CEO James Hogan and Jet Airways promoter Naresh Goyal were present at the meeting. Etihad is likely to pick up a 24 per cent stake for around Rs 1,800 crore in India’s second largest airline.

Though Hogan and Goyal did not divulge the details of the meeting, Singh said the airline officials elaborated on the finer points of the deal.

He said Etihad had raised some policy concerns, which was natural for any airline investing in a new country.

“There are a lot of concerns, but I don’t see any problem. Any foreign airline investing money has many concerns — what’s the policy, the cost structure, so that one makes money out of it. They have been discussing this deal for over a month. Since the government allowed FDI by airlines, talks have been going on,” Singh said.

He, however, said the agreement should conform to the regulatory framework. “Once they sign the agreement, we will go through the regulatory requirements. Unless the deal is signed and approved, we cannot say it is done. But I do not see any problem.”

State-run Air India had opposed the deal as it would impact the revenues of domestic airlines and airports with the possibility of Jet feeding into Etihad’s global network.

Singh brushed off these fears and said, “Our concern is that the aviation sector should grow. Competition should grow.”

Jet sources said they would seek regulatory approvals only after the deal was firmed up. “An appropriate announcement will be made upon finalisation of the terms of the investment with Etihad according to legal and regulatory requirements,” they said.