Kingfisher cannot be closed down because of losses: Govt

37710 Investors following Kingfisher Air. Share this News with them.

0

Like this story, share it with millions of investors on M3

Kingfisher cannot be closed down because of losses: Govt

Beleaguered Kingfisher Airlines cannot be closed down just because it is making losses and banks are not helping it out with funds, Civil Aviation Minister Ajit Singh said today.

Post your opinion here

 

0

Tweet

Share on Tumblr

ALSO READ See latest News about Kingfisher Air See previous management interviews See what other Experts & Brokerages are saying about Kingfisher Air

Beleaguered Kingfisher Airlines cannot be closed down just because it is making losses and banks are not helping it out with funds, Civil Aviation Minister Ajit Singh said today.

"You can't close down a company because they are making losses or banks are not giving them money. As long as passenger safety is not jeopardised, as long as they keep their schedule, why should we close down any industry," Civil Aviation Minister Ajit Singh told reporters here.

He was responding to a question from reporters whether the Government would take stringent action against the airlines if it flouts rules. His comments came even as the Vijay Mallya-owned carrier was asked by its bankers to infuse fresh equity on its own before they lent it additional funds. Bank chiefs have been quoted as saying that Kingfisher would need to arrange fresh equity of Rs 1,000-2,000 crore before seeking additional funds from the consortium of banks, led by the State Bank of India.

To another question, the Minister said closing down of any airline would impact passengers. He said Kingfisher has submitted a new schedule of its flights to the Directorate General of Civil Aviation (DGCA) which would closely monitor it. A consortium of 18 banks, comprising 14 state-owned and four private banks, have provided huge sums to the cash- strapped airlines, which has a total debt of about Rs 7,057 crore and accumulated losses of about Rs 6,000 crore.

The banks are expected to hold meetings with the Reserve Bank of India on the financial mess facing the airline as its loans are reportedly turning to non-performing assets in the past weeks. They are expected to to take a call on whether or not to extend fresh credit line to the ailing carrier.