Most Indian airlines suffered losses in 2012-13

Tags: News
Almost all Indian airlines, barring Jet Airways, IndiGo and GoAir, suffered losses in 2012-13 with Air India suffering the highest loss of Rs 5,490 crore, Lok Sabha was informed today.

While no-frill carrier SpiceJet registered a loss of Rs 2,798.2 crore in 2012-13, Jet's low-cost subsidiary JetLite recorded a loss of Rs 2,468 crore, Minister of State for Civil Aviation G M Siddeshwara said in reply to a question.

Low-cost airline IndiGo earned a profit of Rs 7,958 crore while GoAir recorded a profit of Rs 851 crore, he said.

A major reason for the losses was the changing air transport environment dictated by the global economic scenario, forcing airlines to seek structural adjustments in order to survive, Siddeshwara said.

In India, important causes include the high and growing debt burden, higher operating costs, huge taxation on fuel, high airport charges and maintenance costs which were afflicting the airline industry, he said.

Air India's provisional losses in 2013-14 stood at Rs 5,389 crore, as the government was taking a number of measures to beef up its financial position, Civil Aviation Minister Ashok Gajapathi Raju said in reply to another question.

The measures included upfront equity infusion of Rs 6,750 crore, equity for cash deficit support of Rs 4,552 crore till 2017-18 and equity for already guaranteed aircraft loan of Rs 18,929 crore till financial year 2021.

Another amount of Rs 7,400 crore was being paid to Air India as government guarantee for repayment of principal amount and interest payment on non-convertible debentures proposed to be issued by the airline to financial institutions, banks and the Life Insurance Corporation.

Maintaining that salary payments had not been stopped in Air India, Raju also said the employees had been paid salaries till May this year and ad hoc or flying allowances till April.

With the national carrier formally joining Star Alliance on July 11, the Minister said Air India's passenger revenue was expected to grow by 3-5 per cent on this count.

To another question, Raju said two more airlines have recently been granted the initial No Objection Certificate (NOC) by the Ministry to start scheduled regional services.

The airlines are Air Carnival for the Southern region and Zav Airways for Northeast and Eastern region, he said, adding that regional airline services needed to be supported by states as they promoted regional connectivity.

EDITORIAL OF THE DAY

  • Mergers apart, Sebi must also allow fund houses to offer diverse products

    The Securities and Exchange Board of India’s (Sebi’s) reported push for merger of open-ended mutual fund schemes is a logical step, as there is li

FC NEWSLETTER

Stay informed on our latest news!

TODAY'S COLUMNS

Arun Nigavekar

Can Hefa actually become a reality?

The ministry of human resource development (MHRD) is actively wo­rking ...

Rajgopal Nidamboor

Creativity is that divine luminosity

Creativity or ingenuity, isn’t a licence limited to ‘functioning’ minds ...

Dharmendra Khandal

No one's getting rich overnight by poaching

We often read in newspapers that tiger skin worth Rs ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture