General News

SENSATIONAL: Did FIPB Under Chidambaram Reject Aviation Ministry's Objections While Approving AirAsia's Proposal?

Written By Ankit Prasad | Mumbai | Published:


  • The Civil Aviation Ministry had raised objections to AirAsia's proposal in 2013, documents have revealed
  • The then FIPB, which was under P Chidambaram, had overruled the objections and approved the proposal
  • An alleged kickback was received at a Mumbai Coffee house

In light of the CBI registering a FIR against AirAsia Group CEO Tony Fernandes as well as a number of associated persons over alleged violation of norms for getting an international flying license and other clearances during the setting up of AirAsia India, which is a JV of AirAsia Group (Malaysia) and the Tata Group, Republic TV has accessed exclusive information that the then Ministry of Civil Aviation had raised a number of objections at the time, which the then FIPB (Foreign Investment Promotion Board) had overruled.

From documents that have been exclusively accessed, Republic TV has learnt that at a meeting of the FIPB on March 6, 2013, when P Chidambaram was the Union Finance Minister, officials of the Civil Aviation ministry who were present had supported AirAsia's foreign investment proposal in principle but had issued a number of instructions, namely that the applicant first set up the company, obtain an aviation license from the ministry, and then divest to a foreign collaborator (get foreign investment) in order to comply with the extant policy framework.

In case its instructions were not to be followed, the Civil Aviation ministry officials said, the DIPP (Department of Industrial Policy & Promotion) may issue a clarification that a policy change that was aimed at infusing capital into cash-starved airlines applies to Joint Ventures that are yet to be incorporated as well.

However, Republic TV has learnt, the objections of the ministry officials were ignored by the FIPB and the request over clarification was also brushed under the carpet.

Further, and sensationally, Republic TV has learnt that a bribe of Rs 50 lakh was given to facilitate the removal of the 5/20 aviation rule according to which an airline must have been flying for five years and have a fleet of at least 20 aircraft before it could operate on international routes -- something which AirAsia India could not comply with at the time. As per CBI sources, unknown government officials under the UPA were paid the bribe at a coffee shop in Mumbai.

Speaking to Republic TV, BJP MP Dr Subramanian Swamy, whose petition in the matter is in the Delhi High Court, said that the FIPB clearance was illegal according to the rules that were in force at the time. He said that P Chidambaram must now be prosecuted for approving an illegal project despite knowing of its illegality. He also cited Anand Sharma, who was in charge of the DIPP at the time, saying that its rules had been bent.

As per the CBI FIR, AirAsia Group CEO Tony Fernandes and others allegedly lobbied with government officials for various clearances, including the removal of the existing 5/20 rule. It had also also alleged a criminal conspiracy “with intent to help M/s. AirAsia (lndia) Ltd. to expedite the approval process and change in aviation policies to suit the company”. 

The FIR had also thrown light on a sum of Rs 12.28 crore being remitted by AirAsia to a Singapore-based company "for a sham contract on the basis of a bogus agreement on plain papers, which was utilised for paying bribe to unknown public servants of Government of lndia and others for securing permit for operation of international scheduled air transport services"

Click here for full details of the CBI's FIR and watch what Dr Subramanian Swamy had to say in the video above.