India
oi-Madhuri Adnal
SpiceJet’s financial troubles are now being closely monitored by the Centre, with the Directorate General of Civil Aviation (DGCA) keeping track of the airline’s operations as well as its financial position.
Union Civil Aviation Minister Ram Mohan Naidu said on Tuesday that the government was monitoring the airline to ensure its financial difficulties do not affect flight operations or aviation safety.
The Centre, via the DGCA, is monitoring SpiceJet’s finances and operations to ensure safety and passenger convenience amid financial troubles, with the airline having received Rs 150 crore under ECLGS.
The monitoring is being carried out through the DGCA, with the Civil Aviation Ministry also examining the airline’s financial situation to a certain extent.
“We have operational and, to a certain extent, financial scrutiny also being done from the ministry through the DGCA because we don’t want safety to lapse,” Naidu said.
The Centre has also been in discussions with SpiceJet over the airline’s financial situation and possible support measures. However, Naidu pointed out that SpiceJet is a private airline and the government’s role in its financial matters is therefore limited.
One of the support measures being considered is the Emergency Credit Line Guarantee Scheme (ECLGS), which was extended to help airlines deal with financial pressure.
According to Naidu, SpiceJet has already received Rs 150 crore through the credit guarantee scheme. The release of any remaining support will depend on discussions between the airline and its banking partners, he said.
The government’s focus, Naidu said, is to ensure that passengers are not inconvenienced and that safety standards remain unaffected while the airline continues its operations.
“Our major priority right now is to ensure the passengers shouldn’t face any inconvenience, the safety shouldn’t be compromised at any cost in terms of operations and then smooth operations are sustained within the airline,” he said.
SpiceJet’s financial challenges
SpiceJet has been facing financial pressure while also dealing with a smaller operational fleet and a decline in its share of the domestic aviation market.
The airline has been seeking financial assistance under the ECLGS, with the Centre previously extending ECLGS 5.0 to support airlines affected by financial difficulties.
The aviation sector also faced additional disruption following the escalation of the West Asia conflict. Airspace restrictions, higher aviation turbine fuel prices and interruptions to international operations added to the pressure on airlines.
The conflict escalated in late February following US-Israeli strikes on Iran, further disrupting air travel and affecting passenger movement. These developments added to the financial challenges already facing airlines, including SpiceJet.
