The Foreign Investment Promotion Board (FIPB) of India has approved a $379m (£248m) deal of the UAE-based Etihad Airways to acquire 24 per cent stake in Jet Airways.
The deal, originally signed in April, is the first foreign investment in the country’s airline industry since liberalisation of foreign ownership of airlines in 2012. It is expected to improve business fortunes of the Indian airlines.
Ajit Singh, Civil Aviation Minister of India, was quoted by The Press Trust of India, as saying that if the two airlines “at any time make changes in shareholding pattern, they have to get permission from the Indian government agencies.”
Earlier, Ethiad agreed to reduce the number of directors on Jet board from three to two, in an effort to offer more control to Indian promoters.
The deal is now subject to the approval of the Union Cabinet and the Securities and Exchange Board of India (SEBI).