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

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

Mallya, 61, secretly fled India in March last year, owing more than US$1 billion (S$1.4 billion) after defaulting on loan payments to state-owned banks and allegedly misusing the funds.

India had submitted an extradition request to Britain in early February.

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," Mr 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 Twitter account yesterday.

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

He was once the owner of the Indian Premier League cricket team Royal Challengers Bangalore and still owns the Barbados Tridents in the Caribbean Premier League.

In February, Mallya was sacked from the board of United Breweries, the company through which he once controlled his business empire.

AGENCE FRANCE-PRESSE