New Delhi, March 26
Plane lessors will be allowed to retrieve most of the deregistered aircraft they leased to grounded Kingfisher Airlines, the aviation regulator said on Tuesday, easing worries that a dispute with global financiers might hurt other Indian carriers.

Financiers have warned that failure to resolve the dispute could starve India of funds needed to develop its aviation industry.

Kingfisher, controlled by liquor baron Vijay Mallya, has been grounded due to a cash crunch.

Lenders, airport operators and tax authorities are trying to recover some $2.5 billion, but disagreement over which creditors should take precedence has left jets stranded.

"We have decided w e should release those aircraft that were deregistered by DGCA," Director General of Civil Aviation (DGCA) Arun Mishra said following a meeting with tax officials and airport operators. He said lessors will have to clear the parking charges from the date of deregistration to the date they fly back the planes.

However, lessor International Lease Finance Corp, a unit of insurer AIG, will not be allowed to take back 2-3 planes it owns before settling a pending litigation, Mishra said.

"Only a few of them are under litigation. Airports have filed a case. We will have to wait for that."

ILFC said on Monday it had successfully removed one of six aircraft in Kingfisher colours but is worried about the others.

The fate of Kingfisher's jets is seen as an important test of an international agreement known as the Cape Town convention, designed to make it more attractive for leasing companies to invest by duplicating U.S.-style repossession rights.

The Airports Authority of India is bound by international convention to let the planes go to lessors, its chairman V.P. Agrawal said.

Germany's DVB Bank said in December it had sued India's aviation regulator and Kingfisher in order to have two planes it financed for the troubled carrier deregistered, a first step toward recouping its funds.

Kingfisher has 25 more planes, both owned and leased, but there has been no request to deregister those, Mishra said.

Reuters reported earlier this month that India will make it easier for leasing and finance firms to reclaim planes used by Kingfisher, after complaints that India was complicating the process. Kingfisher made no immediate comment. — Reuters

New Delhi, March 26
The government has cleared Malaysian budget carrier AirAsia’s proposal to start a passenger airline in partnership with the Tata Group with an investment of Rs 81 crore. The proposal was cleared by the Foreign Investment Promotion Board, the finance ministry said on Tuesday.

AirAsia recently said it would set up a 49:30:21 joint venture with the Tata Sons and Telestra Tradeplace of Arun Bhatia, who is related to L.N. Mittal, to launch a new Indian airline.

AirAsia is the first foreign airline to set up a joint venture in the Indian passenger airline segment after easing of the FDI policy in the sector last September.

Following the FIPB clearance, the AirAsia joint venture would now have to approach aviation regulator Directorate General of Civil Aviation (DGCA) for further clearances and a scheduled air operator’s permit.

The government today approved 6 FDI proposals, including that of AirAsia Investment totalling over Rs 732 crore. The Foreign Investment Promotion Board, headed by Economic Affairs Secretary Arvind Mayaram, also cleared the proposal of SIDBI Social Venture Trust to allot Class A units of the Fund to bring foreign investment worth Rs 285 crore.

“Based on the recommendations of FIPB in its meeting held on March 6, 2013, the government has approved six FDI proposals amounting to Rs 732.77 crore approximately,” the finance ministry said.

The biggest proposal that was cleared was that of Hyderabad-based Navayuga Road Projects to act as an investing company and to make downstream investments in its Special Purpose Companies worth of Rs 357.60 crore.

The board also cleared Hyderabad-based AET Laboratories Pvt Ltd's proposal for induction of additional foreign equity in a pharmaceutical company worth Rs 5.34 crore.

The proposal of Bharat Electronics Ltd, Bangalore to set up a JV company worth Rs 2.5 crore to carry out the business of design, development, marketing, supply and support of civilian and select defence radars for Indian and global markets was also approved.

The board, however, deferred seven proposals and rejected one. The proposals which were deferred include that of ICICI Venture Funds Management Co to bring fund from a foreign limited liability company FVCI for making investment in the units of a Trust for making investments in portfolio companies in India.

Andhra-based Prithvi Information Solutions’ proposal to issue warrants to carry out the business of end-to-end solutions in information technology, RF engineering and knowledge service apart from providing consulting and staff augmentation, was also rejected by the FIPB, adds PTI.

New Delhi, March 26
Close on the heels of raising US $1 billion, Bharti Airtel said Tuesday it has garnered another $500 million through a bond issue mostly to pay off high interest loans and fund capex needs.

The company, which had on March 11 raised $1 billion through a 10-year bond issue, raised $500 million through senior notes. Its subsidiary "Bharti Airtel International ( Netherlands) BV has successfully raised $500 million notes (the Additional Notes) in addition to the recently concluded transaction of $1 billion 5.125% fixed rate senior unsecured guaranteed 144A/Reg S Notes due 2023," Bharti Airtel said.

The company said additional notes were issued at a premium and priced at 100.625% to yield 5.044% and will be consolidated and form a single series along with the $1 billion notes that were issued on March 11, 2013.

This is the largest ever telecom transaction out of Asia ex-Japan and the largest ever US dollar issue of an Indian company since rating action last year. "The transaction is the first tap issuance out of India this year making it largest single tranche issuance in 2013 so far," the company said. A tap issue allows an issuer to avoid certain transaction or legal costs like issuing prospectus, and expedite fund raising process.

Bharti Airtel said the transaction drew an order book of approximately $2 billion with participation from 140 high quality investor accounts.

The only other recent tap bond issue was sold by Reliance Industries in March, 2012 when the company raised an additional $500 million, following its $1 billion issue the previous month.

So far in 2013, over half a dozen companies, including Reliance Industries, PowerGrid, Tata Com, ICICI Bank, HDFC Bank, Exim Bank, Bharti Airtel and Suzlon Energy, raised nearly $6 billion from overseas debt market. — PTI

New Delhi, March 26
India's financial capital Mumbai slipped to 66th rank in the list of the world's leading financial centres, but New Delhi failed to make a mark, according to the latest Global Financial Centres Index (GFCI) released Tuesday.

GFCI, which provides profiles, ratings and rankings for 79 financial centres worldwide, ranked Mumbai at the 66th place, down three places from last year when it was ranked 63rd on the coveted list.

Mumbai is the only Indian city on the list, which was topped by London. New York was ranked second in the list followed by Hong Kong and Singapore in the third and fourth place, respectively.

Others in the top 10 are: Zürich (5th), Tokyo (6th), Geneva (7th), Boston (8th), Seoul (9th) and Frankfurt/Main (10th).

Although New Delhi, the country's political hub, was added to the GFCI questionnaire recently and its progress was being monitored, it failed to make it to the list. Almaty, Baku, Busan, Guangzhou, Liechtenstein, New Delhi, Riga, Santiago, Tel Aviv and Tianjin have been added to the GFCI questionnaire recently and "we track their progress with interest" GFCI said, adding that "they have yet to acquire sufficient assessments to be included in the Index".

As many as 26 financial centres improved rankings from last year, 44 centres declined, 7 showed no change and 2 (Panama and Cyprus) entered the list for the first time. All but six centres in the GFCI experienced a rise in the ratings.

According to the index, the 10 centres that are likely to become more significant in the next few years are: Singapore, Shanghai, Hong Kong, Seoul, Toronto, São Paulo, Luxembourg, Istanbul, Beijing and Moscow. — PTI

New Delhi, March 26
Micromax promised on Tuesday to try to work out a patent deal with Ericsson after the Swedish equipment-maker sued the leading domestic handset maker for alleged patent infringement.

The company issued the statement after Delhi High Court on Monday gave an interim ruling in favour of Ericsson, which had filed a US $18 million suit against Micromax, accusing it of using its patented technology to make mobile phones.

The suit marks the first high-profile Indian patent litigation case amid a number worldwide, notably between Apple Inc of the United States and South Korea's Samsung Electronics Co.

The court told Micromax to work out what is known as a Fair, Reasonable and Nondiscriminatory, or FRAND, licence agreement with Ericsson.

Handset makers often rely on technologies owned by other firms to make their mobile phones and conclude a FRAND licence agreement when doing so.

"Micromax is committed to negotiating a FRAND licence with Ericsson as Ericsson has undertaken to provide" such a licence to Micromax," the company said in an emailed statement.

Micromax was also told to pay Ericsson royalties of up to two percent of the sale price of the disputed handset devices and deposit the sum with the court.

A spokesman for Ericsson was not immediately available for comment.

The two sides had been negotiating an agreement for over three years but had been unable to agree on a price for the technology, media reports said.

Micromax, which is India's biggest handset maker and sells phones in over a dozen countries, declined to comment further. — AFP