NEW DELHI Feb 20 India's aviation
regulator has summoned top executives of Kingfisher Airlines
to explain large number of flight cancellations since
Saturday, even as the aviation minister ruled out providing any
aid to the loss-making carrier.
On Saturday, 32 out of the 240 flights that Kingfisher
operates each day were cancelled and the situation was likely to
continue for four days, the airline said in a statement.
"It is a very serious matter, we recognize it and DGCA has
called Kingfisher to find out what's going on, what are their
plans and why did not they anticipate the problems and inform
DGCA before," Civil Aviation Minister Ajit Singh told reporters.
The Directorate General of Civil Aviation (DGCA) is the
sector regulator in India.
Kingfisher has so far failed in efforts to get fresh equity
capital. Banks own about a quarter of its shares after the
company's debt was restructured early last year.
State-run State Bank of India, the lead bank, has refused to
lend further if the airline did not infuse fresh equity.
Singh said it was the government's responsibility to help
national carrier Air India, but in case of private
airlines such as Kingfisher, it was for the bank to take a call
on providing fresh loans.
Kingfisher, named after the country's most famous beer, lost
4.4 billion rupees in fiscal third quarter that ended in
December, and its bank accounts had been frozen by the tax
authorities over outstanding dues.
"As far as private airlines are concerned, they are talking
to banks, and banks will lend them money only if they are
confident that their business plans will succeed, only if it is
within RBI guidelines," Singh said.
When contacted by Reuters, DGCA chief E.K. Bharat Bhushan
declined to comment.
Meanwhile, passengers have been venting their anger at the
airline on social networking websites, blaming the company's
inability to provide on time information about cancelled
India's airline companies, on course to lose $3 billion for
the year ending in March, have struggled with low fares, high
jet fuel prices and massive competition. Five out of six major
carriers in India are loss-making.
Shares of Kingfisher have gained 1.5 percent since
mid-September, when its auditors first cautioned the company
needs equity infusion to function as a going concern. The
benchmark index gained 9.5 percent in the same period.
(Reporting by Anurag Kotoky; Editing by Rajesh Pandathil)