Govt refers Jet's proposal to raise $400 mn to CCEA

The government today referred a proposal by private carrier Jet Airways to raise Rs 2,000 crore from foreign investors to the Cabinet Committee on Economic Affairs (CCEA).

The proposal was recommended for the consideration of the CCEA as the investment involved is above Rs 600 crore, an official statement said.

Jet had planned to raise $400 million (Rs 2,000 crore) via equity investment through the Qualified Institutions Placements route from foreign institutional investors.

Earlier the Foreign Investment Promotion Board (FIPB) had deferred the proposal by the private carrier following request from the Civil Aviation ministry as Jet's proposal could have resulted in breach of the 49 per cent cap on FDI in an Indian airline.

The FIPB had also mentioned that even if it were to approve Jet's fund raising plans through foreign investment, the proposal would have to be cleared by CCEA as it was above Rs 600 crore.

The airline intended to raise the money to meet the cash flow requirements and had got the shareholders' approval for the same on July 24.