Top Indian officials step into Jet Airways crisis

State Bank of India chairman, finance minister meet in Delhi, along with civil aviation secretary and principal secretary to the Prime Minister
Top Indian officials step into Jet Airways crisis
By James Mathew
Wed 20 Mar 2019 05:32 PM

The top echelons of India’s federal finance ministry appear to have stepped in to deal with the crisis circulating around Jet Airways.

State Bank of India (SBI) chairman Rajnish Kumar met finance minister Arun Jaitely in Delhi on Wednesday, along with civil aviation secretary Pradip Singh Kharola and principal secretary to the Prime Minister, Nripendra Misra.

"Will make every effort to keep Jet Airways flying," Kumar was quoted by wire agency PTI.

SBI, leader of the bankers’ consortium to the embattled Jet Airways, has proposed a restructuring plan for the airline, which envisaged conversion of debt into equity by the lenders, equity infusion by promoters including minority stakeholder Etihad Airways and raising resources through sale and lease back of the planes owned by Jet, among other things.

The Abu Dhabi-based Etihad holds 24 percent stake in Jet Airways.

There were reports on Tuesday about Etihad informing SBI its plans to exit Jet and that it was willing to sell its stake to the bank at a discount to the prevailing market price of the carrier.

On getting a new player in Jet Airways, Kumar said: "No possibility is ruled out"

"The dialogue with Etihad is on. It is not that they have conclusively decided that they will go out. But there are certain conditions which they want to be fulfilled and it is nothing but that the airline should be professionally managed and without any interference," he added.

Etihad had reportedly proposed certain conditions, some of which require approvals by some of India’s regulatory bodies, for it to consider agreeing to the bank-led bailout package for Jet Airways.

Putting Jet Airways under the Insolvency and Bankruptcy Code (IBC) was the last option, Kumar said.

The pilots union of Jet Airways on Thursday threatened to stop flying from April 1 if their salaries were not paid by March 31.

The cash strapped Jet has been forced to ground more than 40 of its aircrafts till Tuesday by its leasing companies due to non-payment of rentals.

Another 34-36 of its planes are grounded due to engine and maintenance related issues. It has a total fleet size of 119 planes.

This has led to large-scale cancellation of flights by Jet in the recent weeks, leading to wide-spread anger and resentment among the customers who had booked its flights much in advance.

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