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Cash-strapped Kingfisher starts operating new flight schedule
Facing severe turbulence, Kingfisher Airlines on Thursday started truncated operations in accordance with its new flight schedule, as aviation regulator DGCA examined its operational details to consider whether to take any punitive action against it for flouting norms.
There was still uncertainty over moves by a consortium of 13 bankers to offer fresh loan for the beleaguered carrier, amid reports that the lead bank State Bank of India has agreed to provide Kingfisher a Rs 1,650 crore (Rs 16.5 billion) relief package. But the bankers were tight-lipped about their plans.
"If the banks find it good business, they will loan their money (to Kingfisher). .... At the same time, the government is not going to ask banks to loan money to any private industry. It is for the banks to decide. They will have to decide on the basis of whether they will get it back or not," Civil Aviation Minister Ajit Singh told reporters.
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Cash-strapped Kingfisher starts operating new flight schedule
Meanwhile, the Directorate General of Civil Aviation (DGCA) has begun examining the submissions made by Kingfisher officials. DGCA chief E K Bharat Bhushan has briefed the minister and sent a report on his discussions with the airline top brass to the ministry, sources said.
The aviation regulator is examining the airline's fresh and curtailed schedule to operate 175 daily flights with 28 operational aircraft, the number of cockpit and cabin crew as also whether it was fulfilling the requirement that 10 per cent of its flights would have to be in the Northeast and other remote places, they said.
Asked whether any punitive action would be taken against the beleaguered carrier for flouting the 1937 Aircraft Rules, Singh said, "DGCA is considering all that. They have received some reports. Right now our priority is to see how many flights they can operate and make sure they are perfectly safe."
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Cash-strapped Kingfisher starts operating new flight schedule
Acknowledging that the airline industry was passing through a difficult phase, the minister said, "Civil aviation is a vital sector for economic growth. We are changing a lot of policies. (The sector) has to be encouraged, it has to grow."
Meanwhile, airport sources said Kingfisher has started operating its flights as per the revised schedule it submitted to the DGCA on Monday.
The airline has said it would operate about 170 flights daily, instead of over 400 it had sought permission for last October when the winter schedule for the airlines came into operation.
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Cash-strapped Kingfisher starts operating new flight schedule
At that time, Kingfisher had informed the regulator that it would fly 64 aircraft, a number which has now come down to 28 as many of its planes have either been taken away by the lessors or were awaiting repairs and spare parts or have been cannibalised.
The airline's bank accounts have been frozen by the Central Board of Direct Taxes as it has to pay Rs 40 crore (Rs 400 million) dues in indirect taxes by March 31.
The company's net loss widened to Rs 444.26 crore (Rs 4.44 billion) for the quarter ended December 31, 2011, due to high fuel costs and weaker rupee from Rs 253.69 crore (Rs 2.53 billion) in the October-December quarter in the last fiscal.
The airlines suffered a loss of Rs 1,027 crore (Rs 10.27 billion) in 2010-11 and has a debt of Rs 7,057.08 crore (Rs 70.57 billion).