'Risky jurisdiction': Aircraft lessors raise alarm over Go First crisis in India

The world's second largest aircraft lessor, SMBC Aviation Capital, has warned that India's decision to block leasing firms from reclaiming Go First planes will jolt the market and spark a confidence crisis, legal papers show. SMBC, along with firms such as Jackson Square Aviation and Bank of China Aviation, raised the alarm after a tribunal gave Go Airlines (India) Ltd bankruptcy protection to allow it to revive itself, but barred lessors from repossessing planes. A boom in traffic in the world's third-biggest aviation market prompted record jet orders but two major airline failures, of Kingfisher Airlines in 2012 and Jet Airways in 2019, have taken some of the shine off the market. "Lessors and international aircraft owners see India as a risky jurisdiction for aircraft leasing," after the failures of Jet and Kingfisher, SMBC told the tribunal ahead of a hearing on Friday where it seeks to quash Go First's bankruptcy protection. "The admission of the petition (seeking protection) will further shake confidence of the international aviation industry," it added in a filing to the tribunal that has not been made public but was reviewed by Reuters. India is a critical market for lessors, in which sale-and-leaseback deals accounted for 75% of plane deliveries from 2018 to 2022, compared with a global average of 35%, data from aviation analytics firm Cirium shows. Go First and SMBC, which also called the Indian airline's insolvency filing a "smokescreen" to defraud creditors and lessors, did not respond to a request for comment. The lessors' anger comes as Prime Minister Narendra Modi touts India's emergence as an aviation powerhouse.<br/>