Kingfisher Airlines got another reprieve on Tuesday, as the directorate general of civil aviation (DGCA) decided not to suspend its operations. But the regulator raised apprehensions about the troubled carrier’s ability to stick to the new flight schedule.
Kingfisher said it would suspend international operations and operate about 120 daily flights with 20 planes as it seeks funding, hours after the government warned the carrier’s licence might be cancelled if it failed to meet safety norms and financial viability conditions. The airline’s chairman, Vijay Mallya, and chief executive, Sanjay Agarwal, met the DGCA and gave the new flight plan.
“If he gives a plan and says I have that many planes, that much schedule, then why should we cancel?,” aviation minister Ajit Singh said, ahead of Mallya’s meeting with the regulator. However, he put the onus on Mallya to maintain the airline’s operations and adhere to the schedule, even as the government constituted a team to check whether the aircraft used were safe.
“The problem is, (in the) last two to three months, he has given several plans and he has not adhered to any of them,” Singh said, warning that the airline was liable for prosecution over unpaid taxes. “If passenger safety is compromised, we’ll not let any airline fly. Safety norms also involves financial viability.”
“We are not giving last or first chance to Mallya. He has to decide whether to run the airline or to how to run the airline. DGCA is looking after the situation. To continue to have the licence, they have to have five aircraft, but at present, the financial situation is bad,” he said.
Mallya said, “We are not going with any ambitious target. We will be operating flights with 20 aircraft. We have decided to suspend our international operations, as we are not on the International Air Transport Association platforms. So, there is no sense in flying abroad.”
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DGCA chief E K Bharat Bhushan said, “Kingfisher is severely hamstrung for want of funds and we still do not have any clarity whether the airline will be able to defray its liabilities. We have no assurance on that.”
“The airline has submitted a new plan with 16 operational and four aircraft in the reserve to maintain schedule integrity,” he said.
Agarwal said the airline would operate with a fleet of 10 ATR and 10 Airbus 320. He said it was in talks with potential investors and might get funding after the government allowed foreign carriers to buy stake in Indian ones. “Some of the potential investments depend on the change in foreign direct investment policy, but there are other investors we are in discussions with,” Agarwal said.
This was the third time Kingfisher gave a truncated schedule to the aviation regulator. The airline, which made a loss of Rs 1,027 crore in 2010-11 and Rs 1,175 crore in the first three quarters of this financial year, has accumulated losses of Rs 6,000 crore. It has Rs 7,000 crore in debt on its books.