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Amid a raging controversy over the Rs20bn ($344mn) deal between Jet Airways and Abu Dhabi-based carrier Etihad, the Prime Minister’s Office said there were no differences among ministers on the issue and that the proposal would be cleared according to the usual practice. |
“This is a matter between private parties which needs to be approved by the concerned agencies as per the policies and laws in place,” the PMO said in a statement.
“This is not an agreement between governments and there is no question either of backtracking from or disowning this proposal as this is not an agreement with the government,” it said.
The PMO said the departments and agencies concerned would look into the proposal and deal with it as is the usual practice.
Some parliamentarians and political parties, including the main opposition Bharatiya Janata Party (BJP), have voiced opposition to the deal and sought an explanation from Prime Minister Manmohan Singh.
“It seems now there is something wrong in this deal as well. We are not against FDI (foreign direct investment) in aviation, but if there is a scam in FDI, we will oppose it,” BJP spokesman Syed Shahnawaz Hussain said.
“The way the civil aviation minister is pointing towards the PMO and cabinet, the prime minister should clear the situation in front of the country,” he said.
The BJP leader compared it with the alleged scandal in the allocation of coal blocks.
A parliamentary standing committee headed by Communist Party of India (Marxist) MP Sitaram Yechury first raised objection to the deal.
After that, senior MPs Jaswant Singh and Dinesh Trivedi and Janata Party chief Subramanian Swamy also wrote letters to the prime minister over the deal.
The Abu Dhabi-based Etihad has agreed to buy 24% stake in Jet Airways. The deal is expected to garner around Rs20.58bn for Jet Airways, which, the company said, will enable it to service its debts and provide passengers with better connectivity.
Earlier Civil Aviation Minister Ajit Singh defended deal saying the investment is important for India and opposition to the pact is politically motivated.
“Those opposing the deal are long on politics and short on facts,” Ajit Singh told reporters when asked about the widespread opposition to the deal.
“It is such an important deal, the first big deal in civil aviation ministry. In terms of FDI, it is bigger than any other deal this year. There are so many dimensions to it,” Ajit Singh said.
The PMO also clarified that there was no question of a U-turn on the air service agreement between India and the United Arab Emirates.
“The prime minister is neither washing his hands off the Bilateral Air Services Agreement nor is the Prime Minister’s Office trying to do a U-turn on the issue now,” the statement said.
On reported disagreements among various ministries on the India-UAE air services agreements, the PMO said: “The allegations in some media are factually incorrect and baseless.”
“There is absolutely no disagreement within the government or between the ministers and the prime minister on the matter,” it added.
But the deal faces regulatory hurdles, with various ministries raising objections over control of Jet after the deal as well as over bilateral plans for an increase in flights between India and Abu Dhabi.
Many of the new seats would go to Jet and Etihad. The opposition has alleged that the nearly four-fold rise in flights was aimed at clinching the deal and could divert vital business from ailing state-run flagship Air India.
The Jet-Etihad deal would supply the Abu Dhabi carrier with hundreds of thousands of new passengers on its routes to Europe, Africa and the Middle East as the emirate aims to become a hub for intercontinental air traffic.
Shares of Jet slid as much as 6% yesterday amid worries over whether the deal would get final permission.