Etihad says talks on Jet Airways investment continue

Etihad Airways is continuing talks with India peer Jet Airways, the UAE-based carrier said in response to reports that the negotiations had run into rough weather.

In a statement issued late Monday, it said: "Etihad Airways continues to progress discussions about further investment in Jet Airways."

Sources told NDTV that fresh disputes had emerged over investment protection and management control.

Shares in Jet Airways plunged as much as 10 per cent on Monday, closing 2.85 per cent lower at Rs. 559.50 on the National Stock Exchange. Other aviation stocks, grounded Kingfisher Airlines and SpiceJet, also ended with deep cuts.

Etihad Airways is reportedly seeking investment protection under the Bilateral Investment Promotion Agreement (BIPA) even though India and the UAE have yet to sign the agreement.

Etihad is worried about investing in India because of the troubled past of some companies from the Middle East, such as telecom major Etisalat and real estate developer Emmar.

The sources also said that Etihad was interested in management control in Jet Airways, something that Jet's promoter Naresh Goyal is opposing.

Etihad has been in talks to pick up a 24 per cent stake in Jet, India's No. 2 carrier, for up to $330 million.