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Civil aviation minister Ajit Singh today met UPA chairperson Sonia Gandhi in the backdrop of the controversy over the enhancement of bilateral air traffic rights to United Arab Emirates (Abu Dhabi).
The Prime Minister’s Office (PMO) on Tuesday had issued a statement claiming that there were no differences between ministries over the agreement but has directed it be brought before the Cabinet to bring in “greater transparency”.
Sources informed the meeting was of political nature as Gandhi is UPA Chairperson and Singh's Rashtriya Lok Dal is part of the ruling coalition.
Ajit Singh said that he had gone to invite Gandhi for laying of foundation stone of Aviation University to be set up in Rae Bareilly. "AAI wants the foundation stone to be laid before July 15, so I had personally gone to invite her.I had written to her on 25th June and two days back had sought appointment so I went and met her.''
The ministry of civil aviation signed an MoU with the UAE on April 24 this year to enhance the number of seats between the two countries from 13,300 a week to 50,000 a week on the same day when Etihad Airways announced it was picking up a 24 per cent stake in Jet Airways for Rs 2058 crore.
The huge expansion in the bilateral rights has sparked off controversy in political circles who have cited security concerns and the shift of operational control in Indian carriers to foreign airlines for a reconsideration of the traffic rights allotted to UAE. The Prime Minister’s Office has now asked the ministry to prepare a cabinet note for post-facto approval of the agreement.
The issue of Jet-Etihad deal is understood to have come up during the meeting.
Bharatiya Janata Party leader Jaswant Singh, CPI's Gurudas Dasgupta, Trinamool Comgress MP Dinesh Trivedi and Janata Party chief Subramanian Swamy have written to the Prime Minister criticising the deals.
The Prime Minister's Office (PMO) has said the decision to enhance seats on the India-Abu Dhabi route and a stake sale deal between Gulf-based Etihad Airways and Jet Airways (India) Ltd were “distinct issues and needed to be “handled separately”. The government said the Jet-Etihad deal was between private parties, which needed to be approved by the concerned agencies as per the policies and laws in place. It has clarified the alliance is under examination of various regulatory bodies.
On June 14, the Foreign Investment Promotion Board (FIPB) deferred a decision on the deal, saying it required more clarity. Market regulator Sebi along with the ministry of corporate affairs had raised objections over issues of effective control of Indian airline post the acquisition by the West Asian carrier.
The civil aviation ministry too had raised concerns on a plan outlined by the two airlines to shift some of the operational departments of Jet Airways to Abu Dhabi, which in effect would mean moving the 'principal place of business' out of India. The Jet-Etihad deal is the biggest in the Indian aviation sector post the government liberalizing FDI norms in aviation.
Civil Aviation Minister had strongly defended the deal, saying those opposing it were "long on politics and short on facts ... 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." He had added the ministry has sought and received some clarifications on issues of control and place of business but have not approved anything.
