When the UAE flag carrier Etihad Airways entered into a deal with Jet Airways in April this year, was the transaction limited to just picking up a 24 per cent stake? Or did it also include management control?
This is the question that is bothering the Indian stock market and investment regulators - read the Securities and Exchange Board of India and Foreign Investment Promotion Board (FIPB). They are now carefully examining every line in the shareholder agreement between the two airlines to see if the Gulf carrier has received any disproportionate rights and privileges from Jet Airways' promoters.
Indian regulations cap foreign direct investment in the airline sector at 49 per cent with a view to ensure that management control remains firmly in the hands of Indians. The UAE carrier, however, has extracted certain concessions from Jet promoters by having a few clauses inserted in the shareholder agreement. It is this set of clauses that has now sparked off a debate and blocked approval of the first FDI deal in an Indian carrier since the relaxing of FDI rules rel3ating to aviation last year.
17/06/13 KR Balasubramanyam/India Today
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This is the question that is bothering the Indian stock market and investment regulators - read the Securities and Exchange Board of India and Foreign Investment Promotion Board (FIPB). They are now carefully examining every line in the shareholder agreement between the two airlines to see if the Gulf carrier has received any disproportionate rights and privileges from Jet Airways' promoters.
Indian regulations cap foreign direct investment in the airline sector at 49 per cent with a view to ensure that management control remains firmly in the hands of Indians. The UAE carrier, however, has extracted certain concessions from Jet promoters by having a few clauses inserted in the shareholder agreement. It is this set of clauses that has now sparked off a debate and blocked approval of the first FDI deal in an Indian carrier since the relaxing of FDI rules rel3ating to aviation last year.
17/06/13 KR Balasubramanyam/India Today
