India arrests officials of aviation regulator, Reliance in drone bribery probe

India's federal crime fighting agency said it has arrested an official from the country's aviation regulator and a Reliance Industries executive on allegations of bribery related to securing regulatory approvals to import drones.

In a statement late on Sunday, the Central Bureau of Investigation (CBI) said it had acted following a tip-off that the Reliance executive and the government official had settled on an amount of 1.5 million rupees ($16,000) to process three applications related to drone imports by Asteria Aerospace.

The CBI named the two men as Mudavath Devula, a deputy director general at the Directorate General of Civil Aviation (DGCA), and Bharat Mathur, a senior vice president from Reliance.

Asteria is a subsidiary of Reliance Industries' technology arm Jio Platforms, which is led by billionaire Mukesh Ambani.

The DGCA, Reliance and Asteria did not respond to Reuters requests for comment. Devula and Mathur could not be immediately reached as they were in police custody.

The CBI initiated the investigation on an "allegation that the accused public servant of DGCA demanded undue advantage from the private persons in lieu of issuing approvals and permissions of applications pending with DGCA," the statement said.

Asteria's website says it is a drone technology company providing intelligence from aerial data, and develops customised drone solutions. It has more than 400 drones deployed so far.

Ambani's Jio Platforms is also gearing up to file papers seeking regulatory approvals for a Mumbai listing, in what is likely to be India's biggest-ever stock offering.

The arrest is also a setback for India’s aviation watchdog, the DGCA, which is already grappling with severe staffing shortages while overseeing a sector where airlines are frequently found to have breached safety norms.

The police arrested the two men in New Delhi and seized 250,000 Indian rupees in cash. Further searches at premises of the DGCA official and other "private persons" led to the seizure of 3.7 million Indian rupees ($40,000), and gold and silver coins, the CBI said.

The CBI's list of the two's suspected offences, detailed in a publicly released case document, included criminal conspiracy and "bribing a public servant by commercial organisation".

India ranked 91 on Transparency International's Corruption Perceptions Index last year from 76 a decade ago.