Runway still not cleared for Jet-Etihad flights to take off

Despite the clearance given for foreign participation in Indian air carriers, the deal for Abu Dhabi-based Etihad Airways to buy a stake in India's Jet Airways – considered a done deal till the beginning of this fiscal year in April – is actually still flying on a wing and a prayer.

Reports today say the Prime Minister's Office has raise concerns over the clearance of the deal, and the cabinet secretariat has called a meeting with representatives of the two airlines to discuss the issues.

Earlier, the PMO had written letters to all the ministries concerned, like finance, commerce and civil aviation, asking them to clarify some of the concerns raised by opposition party leaders like the Janta Party's Subramanian Swamy and the Bharatiya Janata Party's Jaswant Singh.

Apart from opposition parties, even the Foreign Investment Promotion Board and the Securities & Exchange Board of India have reportedly told the civil aviation ministry that there is need further deliberation.

The signal for civil aviation minister Ajit Singh is that the proposal will need careful consideration in view of allegations that the deal will be to the detriment of Air India.

Already, Jet Airways has been forced to amend its shareholders' agreement with Etihad following concerns raised by SEBI. The regulator wanted a clause stipulating that Jet and Etihad could vote together as persons acting in concert to be removed.