India: Airlines seek emergency credit from oil firms, airports

Airlines in India are asking the government to help them obtain unsecured credit from oil companies and airports, as fuel-price increases push them deeper into losses and imperil their survival. Competition and aggressive pricing are stopping fares from rising to reflect higher input costs, the Federation of Indian Airlines said in a letter sent to the aviation ministry’s top bureaucrat last week. A spokesman for the group confirmed the letter and its contents, but couldn’t comment further. Airlines are “facing challenging times and substantial losses in the domestic environment,” the communication addressed to Aviation Secretary Rajiv Nayan Choubey said. The plea is the latest signal of the crisis facing airlines in India, where the world’s fastest-growth in air travel has created a capacity glut that’s keeping fares below cost, while fuel prices and a weaker rupee squeeze them further. Jet Airways India, the market’s second biggest player, is struggling to stay afloat after delayed payments to staff and lessors, and is in talks with investors to raise funds. The FIA consists of Jet, InterGlobe Aviation’s market leading IndiGo, SpiceJet and Go Airlines India, which together account for almost 80% of the domestic market. Losses at Indian carriers will balloon to as much as $1.9bi in the year ending March 2019, and they need to raise more than $3b in working capital in the near term, according to CAPA Centre for Aviation. <br/>