Britain arrests Indian tycoon Mallya for extradition

Vijay Mallya secretly fled India in March 2016 owing more than $1 billion after defaulting on loan payments to state-owned banks and allegedly misusing the funds 

Indian tycoon Vijay Mallya has been arrested in London following an extradition request from India where he is accused of fraud, British police said on Tuesday.

The flamboyant financier, who co-owns Formula One team Force India, appeared in a London court on Tuesday and was granted bail.

Mallya fled India in March 2016 owing more than $1 billion after defaulting on loan payments to state-owned banks and allegedly misusing the funds.

India submitted an extradition request to Britain in early February after investigators demanded the 61-year-old be brought home to face charges.

India's junior finance minister Santosh Gangwar said the government would do everything in its power to bring Mallya to justice.

"We will not spare anyone who is within the ambit of law. Criminals will not be spared," Gangwar told reporters in New Delhi after the arrest.

"We will definitely work to bring him back to the country."

But the business baron played down the arrest.

"Usual Indian media hype. Extradition hearing in court started today as expected," he posted on his official Twitter account on Tuesday.

Mallya, known for his lavish lifestyle, made Kingfisher beer a global brand and ran a now-defunct airline with the same name.

He stepped down as the director of the Indian Premier League cricket team Royal Challengers Bangalore last year but still owns the Barbados Tridents in the Caribbean Premier League.

In February the Indian government said it was considering new measures to seize the assets of "big time offenders" who fled abroad.

That same month Mallya was sacked from the board of United Breweries, the firm through which he once controlled his business empire.

- 'King of Good Times' -

Mallya's financial dealings are being investigated by the federal Central Bureau of Investigation and the Enforcement Directorate, a financial crimes agency.

A Indian court in January ordered a consortium of banks to start the process of recovering loans from the tycoon.

Mallya was once known as the "King of Good Times" but dropped off India's most wealthy list in 2014, engulfed by the massive debts of his grounded carrier Kingfisher Airlines.

His huge debt has come to symbolise the problems which bad loans pose to Indian banks and to overall financial stability in Asia's third-largest economy.

Critics say the government has not done enough to tackle the issue of wealthy individuals such as Mallya, who obtain huge loans which they later fail to repay.

Mallya inherited United Breweries Group from his father at the age of 28 and turned it into one of the world's largest spirits makers, hosting extravagant yacht parties with Bollywood stars and politicians along the way.

His profile rose further when he acquired a stake in the Force India F1 team and ownership of the Royal Challengers Bangalore.

But his fall from grace was spectacular.

The businessman was forced to quit as a member of India's parliament last year after an upper house ethics committee recommended his expulsion.

His diplomatic passport was revoked in April last year after he repeatedly failed to appear before investigators.

Mallya, who now lives in a sprawling $15 million mansion in England's county of Hertfordshire, has denied absconding and has criticised the media for what he has called a "witch hunt".