While critics of India’s successive aviation ministers refer to Rajiv Gandhi Bhawan as ‘the Ministry of Jet Airways,’ the first visible casualty of Naresh Goyal’s deal with Etihad of the UAE has come to the fore.

Nikos Kardassis, a man described by Goyal, ‘as one of his close friends and one of the wisest men in the airline business’ has quit without comment. The man served as CEO from 2008 until date (he also served as CEO in 1993-99).

And while the notice has come out on June 7, the resignation has been announced with effect June 5!

What stopped a listed entity from announcing things a little in advance? Or was Friday chosen so that the stock was least affected until trading closed for the week? One can only guess.

Governance has never been a subject of much interest to Goyal. Government certainly is.

Few could have been able to steal the Etihad deal right under the nose of Kingfisher’s Vijay Mallya, not to mention clinch the unprecedented increase in landing slots and gateways Singh recently granted to carriers from the UAE (read Etihad).

Kardassis’s exit merits a quick account of how Goyal, the king of India’s aero-political jungle, risked a lot more than a CEO for the Etihad deal:

Everyone knows that Goyal wanted the deal pretty badly. His airline, powered by an overseas corporate body incorporated in the Isle of Mann, started off as a humble travel agency before turning ‘air traffic operator’ in 1993, grew steadily where others like East West, ModiLuft and Damania fell by the wayside; but thanks to a buy out of Sahara, was dangerously leveraged. Banks were breathing down Goyal’s throat.
But Vijay Mallya was just as desperate, wasn’t he? Mind you, he didn’t have a lesser chance. Kingfisher may have been doddering and the employees unpaid for several months, Mallya was a second-time Rajya Sabha MP and with decent cash stashed in his non-aviation businesses.

At one stage last December, Mallya was so confident of getting Etihad that he air dashed to Tirupathi and donated three kilos of gold at Balaji. Soon after that there had to be a huge birthday party in his Nepean Sea apartment where his PR set the story up that the Sheikh of Abu Dhabi would be attending.

“Hot girls, good-looking hunks, delicious food and a yummy birthday cake were all the ingredients of Dr Mallya's private bash. Like always, the theme colour of this do was white and Vijay, or VJM as his close friends call him, sported a linen shirt with the words 'The King' embossed at its back,” the Times of India reported, tongue firmly in cheek.

During those three days in the middle of December, while employees seethed in anger, the KF stock was on a roll. As for the grand party, needless to say, while socialites like Yana Gupta and other VJM regulars came by, the Sheikh never did.

Far from this madding crowd, a very different PR strategy was playing out in Abu Dhabi. Commandeering it were Goyal and his wife Anita. No sign of Kardassis, but a fair deal of help forthcoming from Hameed Ali, a Bahrain national, who is now ‘acting CEO.’

Rather than expecting one of the richest men in the world to show up at their doorstep, the Goyal duo parked themselves in a house in the city, spent entire days in the court’s vicinity, pumping hands with any man, priest or beast who could influence the Sheikh. No prizes for guessing, this below-the-radar stuff hit bull’s eye, while Mallya’s blitzkrieg through Mumbai’s afternoon dailies fell into the Arabian Sea.

While Kardassis may disagree, Goyal’s friends pop up in unlikely places. James Hogan, the present CEO of Etihad, proved to be one of them. A dear friend of the Goyals while he was a top gun at Gulf Airways, Hogan once represented the 20-per-cent owners in Jet Aiways. Goyal got the aviation ministry to endorse Hogan’s foreign equity, then raised a red-flag when Singapore Airlines wanted to enter India in partnership with Tatas; and finally, citing yet another change in India’s FDI regime, had him (and Kuwait Airways) exit at a discount, but still retaining him as a close friend!

This set stage for Goyal influencing the most audacious change in aero-political policy by India in recent times.

Here’s how: The Shiekh of Abu Dhabi Sheikh Khalifa bin Zayed Al Nahyan owns a sovereign fund in the excess of $500 billion. The chairman of that fund, Sheikh Hamed bin Zayed Al Nahyan, is also the chairman of Etihad. In a deeply incestuous polity, the fuse blew when a special court in Hyderabad agreed to serving of fresh summons on chairman of Emaar Properties PJSC, Dubai, Mohamed Ali Rashed Alabbar, second accused in one of the charge-sheets filed by the Central Bureau of Investigation (CBI), through Interpol.

“Admitting a petition filed by the CBI seeking issuance of fresh summons to be served on Mr Alabbar with three months validity, the special court has agreed to issue summons with January 31 as the date of appearance of the accused before it,” The Hindu reported on October 10, 2012.

“The CBI said that the summons issued by the court for the first time with two months’ validity were returned by the Ministry of External Affairs (MEA) stating that three months validity was necessary to take the help of Interpol in getting the summons served. The MEA had suggested the CBI to get the fresh summons issued by the court with the required validity. Once the summons were sent to the Interpol through the MEA, the international police organisation would serve the same on the accused asking him to appear before the designated court by the given time, sources in the CBI said. If the individual fails to attend the court, similar summons would be served a few more times before issuing the warrant for his arrest.”The Sheikhs had never imagined one of them could be humiliated like this in India. The Hyderabad matter was ‘red flag’ enough for them to call the whole thing off. This didn’t just include their plan to invest money in India’s largest private carrier, but also infrastructure funds that New Delhi has been coveting for several months.

It appears that Naresh Goyal played a key role in smoothening rough feathers including MEA to apply the brakes in the way it did. His genius? Visits by external affairs minister Salman Khurshid, finance minister P Chidambaram, and commerce and industry minister Anand Sharma were anchored in such a sophisticated manner that the Jet deal became a litmus test for the future of all UAE investments in India.

It is another matter that the recent enforcement directorate (ED) notice to Emaar MGF worth some Rs 8,600 crore has raised the bug bear once again. In fact, Chidambaram was (coincidentally?) in Dubai this Sunday itself after which Khurshid issued a statement to PTI: "Finance Minister, myself and Commerce Minister have all gone to UAE. We were just following up on the important decisions that have to be taken. He (Chidambaram) has been travelling, looking up for investments in infrastructure sector."

Now, where does Naresh Goyal feature in all this? It is he sold the idea that even as Hyderabad police refuses to play ball over the Emaar Sheikh, New Delhi must offer an olive branch of  an unprecedented hike in air slots and gateways to India. The three ministers agreed immediately, even as Germany, Singapore, Qatar, and many others lined up outside Rajiv Gandhi Bhawan were left fuming with very little addition to their air entitlements.

Meanwhile, Etihad got a four-fold increase, without even asking!

“Three months ago, the civil aviation minister had publicly stated that Middle-East carriers would get any traffic rights only if their Indian counterparts were allowed the same privileges. I don't know what happened in those three months for the government to make an about-turn and change its position on not giving bilateral privileges to Middle-East carriers. In fact, Etihad was never in the line for seeking enhanced bilateral agreements. The demand was primarily made by Qatar and Emirates. But this deal had changed the entire scenario,” wrote Kapil Kaul, CEO of CAPA, a premier aviation think tank.

Mr Kaul, now you know!

All sweet-heart deals must have a twist in the tail. So, with the ED notice, New Delhi and Abu Dhabi are still locked in air brushing over the Emaar Sheikh. And Goyal had to let go his CEO.