Swamy’s petition over India-Abu Dhabi ASA threatens to delay Jet-Etihad deal

A petition filed in the Supreme Court seeking to annul a bilateral seat enhancement pact between India and Abu Dhabi that coincided the sale of Jet Airways stake to Gulf-based carrier Etihad now threatens to further delay the deal.

The petition, filed by Janata Party MP Subramanian Swamy, seeks an investigation by the Central Bureau of Investigation (CBI) into the role of the ministries of civil aviation and external affairs in amending the India-Abu Dhabi bilateral Air Service Agreement (ASA), which grants 36,670 additional seats to airlines between the two countries.

Swami, in his petition filed on Monday, sought CBI probe ''to determine if there was any abuse of power by any public servant to obtain any pecuniary advantage or valuable thing for the benefit'' from either Jet Airways or Etihad Airways for getting the bilateral approved.

Swamy's petition alleges large-scale corruption in the ASA, which allows airlines of both countries to offer almost 50,000 seats a week by 2015, up from 13,300 at present.

The petition makes the ministries of civil aviation, external affairs, commerce and finance as also the Foreign Investment Promotion Board, Department of Industrial Policy and Promotion, aviation regulator DGCA and the two airlines involved in the equity deal as respondents.

The ASA, which has already been cleared by the union cabinet, would make Etihad richer by almost Rs10,000 crore every year through its equity deal with Jet. At the same time, the bilateral would cost national carrier Air India losses to the tune of about Rs2,555 crore every year, while other domestic airlines stand to lose about Rs773 crore per year, the petition states.

In fact, as per Swamy's petition, not only did Etihad get a largesse of an ''unprecedented increase in capacity entitlement for itself, ie, up to 50,000 seats per week, as well as third country and domestic code sharing, but by investing into the Indian carrier and entering into inter-se arrangements evidencing effective control over Jet Airways, it managed to get surrogate control and reap the rewards from the Jet Airways' share of the Indian bilateral, thereby effectively getting approximately 90,000 seats per week to and from India in contrast to the genuine entitlement of merely 13,300 seats.''

Swami has sought revoking of the bilateral pact reached between India and Abu Dhabi.

Swamy's views have already been aired in public earlier by some other MPs who have also alleged large-scale corruption in the undue haste showed by the civil aviation ministry in getting the ASA amended.

A Parliamentary committee has also raised the matter of how this bilateral pact will kill Air India and local carriers.

Etihad, which has picked up 24 per cent equity stake in the Indian airline, meanwhile, has already gone ahead with the deal with top-level changes in the management of Jet Airways.