‘No Intention of Raising Funds For Jet Airways,’ Says Civil Aviation Minister HS Puri
New Delhi: Union Civil Aviation Minister Hardeep Singh Puri, speaking in the Lok Sabha, denied any role of the government in raising funds for the cash-strapped Jet Airways (India) Limited stating that it is an internal matter of the airline.
According to the Union Minister, the government has no intention of stepping in to sort out the finances of private operators.
“Mobilizing financial resources and ensuring efficient operations as per business plans are the responsibility of the airline,” said Hardeep Singh Puri.
“The government has no role in raising funds for Jet Airways (India) Limited, as it is an internal matter of the airline,”
“As far as Air India is concerned, we have taken a conscious decision to privatize the operation because of the debt it has incurred over a period of time,” he added.
Therefore, In a written reply, the Minister said that the State Bank of India has filed an application under the Insolvency and Bankruptcy Code, 2016. Which has been admitted by National Company Law Tribunal (NCLT), Mumbai, to work out a resolution plan under the said code.
“Revival of the airline is now possible only under IBC,” he said.
Responding to supplementaries in the lower house on the issue, Mr. Puri said that providing facilities to the public was a concern for the government, but it does not make the “business model” for private airline operators.
“They conduct their own business, they have agreements and they take loans. Hence it is not for the government to step in,” he said adding that the government had no intention of stepping into private airline operators.
He said Jet Airways reported aggregated losses during the last few quarters. Which eroded its liquidity and jeopardized its ability to sustain its operations.
Therefore “As a result, there were significant overdue towards all creditors. Whcih includes the lessors of the aircraft, pilots, suppliers, oil companies, etc,” he said.
Additionally, To a question whether Etihad Airways has shown interest in the acquisition of Jet Airways. Hence, The minister said in a written reply that based on the business plan prepared by McKinsey. Therefore the domestic lenders finalized a Bank Led Resolution Plan. Hence, Which was in accordance with the Revised Framework of Resolution of Stressed Assets under “Project Shashakt”.
“Hence, Despite best efforts, the differences between the two partners – Jet Airways promoters and Etihad Airways. It could not be bridged and eventually, the resolution plan was not accepted by the Board of Etihad Airways,” Mr. Puri said.
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