The Jet-Etihad deal is in trouble again. The government’s anti-corruption body Central Vigilance Commission is looking into allegations by BJP MP Nishikant Dubey of corruption in the Rs 2,058-crore deal between the two airlines, and has sought an explanation from the Ministry of Civil Aviation.

CVC sources told Business Line that the commission will wait for the reply from the Ministry before taking a final decision on the issue. A CBI probe into the deal was also not ruled out. In a recent letter to the Prime Minister, Dubey said the “sequence of events and ever willingness” of the Government to remove barriers for the Indian carrier to complete its deal with Etihad was “curious” since the ownership of Jet Airways is shrouded in mystery.

The letter pointed out that on March 1, the Directorate-General of Civil Aviation deleted and modified guidelines that prevented effective control of management of a domestic airline from being given to a foreign airline. The letter added that another clause that prevented a domestic airline from entering into financial arrangements such as lease-finance and hire purchase with a foreign airline was also changed. This allowed Jet Airways to receive a soft loan of $300 million at 3 per cent, Dubey claimed.

Pointing to the “seriously wrong” overall approach and execution of the bilateral agreement between India and the UAE, Dubey told the Prime Minister that it was now public knowledge how “you and four senior ministers” had cleared in haste the bilateral agreement between India and the UAE.However, Aviation Minister Ajit Singh denied any “haste” in negotiating the air services agreement with Abu Dhabi.

On April 24, Jet sold a 24 per cent stake to Etihad for over Rs 2,000 crore. On the same day, India and the UAE exchanged an air services bilateral that allowed airlines from India and Abu Dhabi to operate more flights.

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