Jet Airways grounds flights, Suresh Prabhu calls for emergency meet

Union Civil Aviation Minister Suresh Prabhu directed the secretary of the Ministry of Civil Aviation to hold an emergency meeting on grounding of flights by Jet Airways. The secreatary has been asked to look into the issues of advance bookings, cancellation, refunds and safety, if any. Prabhu has asked for a report on Jet compliance issues from the Directorate General of Civil Aviation (DGCA) immediately.

Jet Airways crisis seems to worsen with each passing day. Amid reports that the Naresh Goyal-led airlines may get new lease of life, Etihad Airways has reportedly said no to any fresh fund infusion. Multiple media reports have claimed that Etihad is not okay with the contours of the bailout package. According to an Economic Times report, Etihad may exit the joint venture if Jet Airways doesn’t agree to its terms. This essentially means that if the stalemate continues, Jet Airways will not receive emergency funds of Rs 750 crore.

Directed Secretary, @MoCA_GoI to hold an emergency meeting on grounding of flights by Jet Airways, Advance bookings, Cancellation, Refunds and Safety issues, if any. Asked him to get a report on Jet compliance issues immediately from DGCA. @jayantsinha

— Chowkidar Suresh Prabhu (@sureshpprabhu) March 19, 2019

A Business Standard report also said that Etihad CEO Tony Douglas visited Mumbai on Monday, where he met some top bankers including SBI Chairman Rajnish Kumar to discuss the Jet crisis. It is in this meeting that Douglas said that Etihad will not infuse fresh funds. The Abu Dhabi based airlines in its statement to the Economic Times said that “As a minority shareholder, Etihad is working closely with Indian lenders, the company and key stakeholders to facilitate a solution for Jet Airways."

In a statement to the Bombay Stock Exchange, Jet Airways on Monday said that “payment of interest due on March 19, 2019 to the Debenture Holder will be delayed owing to temporary liquidity constraints.”

Earlier a March 11 report had said that the Gulf carrier is likely to infuse around Rs 1,600-1,900 crore into cash-strapped Jet Airways under a proposed deal wherein Naresh Goyal would step down as chairman of the domestic carrier, according to sources.

Jet Airways, a full-service airline, has been grappling with acute financial crunch that has also forced it to ground many planes as well as delay payment of salaries and loan repayments.

Under the proposed deal, Goyal would step down as chairman and director of Jet Airways but can nominate two persons to the airline's board. Goyal would be designated as chairman emeritus while his son Nivaan Goyal would be offered an appropriate executive position subject to certain conditions, the sources said.