The 24 per cent stake sale between Jet Airways and Abu Dhabi-based Etihad Airways has hit another roadblock. The Centre is now examining whether Naresh Goyal, Chairman, Jet Airways, who is an NRI, his share in the airline should be considered as Foreign Direct Investment (FDI). If the Department of Industrial Policy and Promotion (DIPP) decides that the NRI stake has to be counted in the 49 per cent FDI cap for investments in the civil aviation sector, the company will have to come up with a fresh proposal.    

Under the existing plan, the investment will breach the FDI limit, a DIPP official said. The FDI policy does not clearly say if NRI investments are to be included or excluded in the FDI calculation for the civil aviation sector. The DIPP is examining this and will submit its views to the Foreign Investment Promotion Board (FIPB), the official said. The FIPB will take a call on the Rs 2,000-crore the deal based on DIPP’s report. Since DIPP is the policy-making body for foreign investments, the FIPB is likely to go by what it decides on the issue, the official added.    

The FIPB may drop Jet-Etihad’s proposal from the agenda if a view is not taken on the matter by then. Last month, Goyal bought 3.18 crore shares, amounting to 36.85 per cent stake in the company, which raised his share in the company to about 66 per cent. The acquisition was in line with the company’s plans of vesting 51 per cent stake with Goyal, 24 per cent with Etihad, and 25 per cent with the public post the deal.