Amid speculation that a consortium of banks led by the State Bank of India (SBI) is considering lending money to cash-strapped Kingfisher Airlines, the DGCA on Wednesday submitted a status report to the government on the airline. Kingfisher, meanwhile, submitted its revised plan schedule to the DGCA.
Sources in the aviation regulator had said earlier that with 28 operating aircraft, the airline can operate upto 175 flights a day. Civil aviation minister Ajit Singh also said on Wednesday that Kingfisher had broken rules by not informing the DGCA about the sudden flight cancellations in advance.
Asked about speculation on the SBI —— the largest public sector bank in the country —— considering lending money to Kingfisher, Mr Singh also said, “We have said it before that banks will decide that (lending money). The government is not going to interfere in it. Banks have to follow RBI guidelines. They have to worry about their NPAs (non-performing assets). They have to decide on the basis of the business plan of the company. If they are satisfied with the business plan, they can lend money,” he said. “So, if the banks can loan them (Kingfisher) money, it is all good,” he added.
Meanwhile, sources in the banking industry said, “A decision will be taken jointly by the consortium banks (on the issue of lending money to Kingfisher).”
The DGCA Status Report is expected to have elaborated on the financial stress afflicting Kingfisher. The government had earlier ruled out cancellation of the operating licence of the airline, even as the DGCA too had earlier on Tuesday ruled out any immediate punitive action against the beleaguered airline.