Under severe financial stress,leading domestic carriers,including national carrier Air India and Vijay Mallya-owned Kingfisher Airlines (KFA),were taking short-cuts on safety front,a financial surveillance report by the Directorate General of Civil Aviation (DGCA) has revealed.
The report had recommended stringent action for violating safety norms,including cancellation of flying permit of Kingfisher and restriction of Air India Express operations. It has asked all airlines to take immediate rectificatory measures to resolve the lapses. DGCA has listed areas where airlines have defaulted,and asked them to sort out safety issues in a time-bound manner.
Top officials of Kingfisher Airlines and Air India Express two serious defaulters met DGCA officials today where they were asked to submit a plan to resolve the issue by Monday.
After a two-hour-long meeting,DGCA chief EK Bharat Bhushan allayed fears of the two airlines being shut down. There was no threat of these airlines being shut down or their licenses being cancelled, he said.
In its report,the regulator had raised serious concerns over safety aspects of these two airlines and suggested cancellation of their operating licences.
In case of Kingfisher,the report said it had a number of aircraft on ground for want of engines/spares thereby operating on a truncated schedule.
Air India Express was found to have outstanding safety issues and shortage of training captains.
This is the second time the DGCA has carried out a financial audit of airlines first being in 2009.
All airlines are going through a critical patch. It is a challenge to see that their financial constraints do not hamper safety. It is our duty to ensure that nobody takes the short-cut on the safety front, Bhushan said.
The audit report,carried out over 3-4 months,focused on issues like maintenance of aircraft,shortage of commanders,pilots and cabin crew,lack of adequate training,scarcity of aircraft engines,components and crucial spares.
DGCA has held meetings with top management of SpiceJet,GoAir,IndiGo,Jet Airways,JetLite on safety-related issues.
All of them have been told about the lapses and asked to inform us about their plans to rectify their problems in a time-bound manner. If there are shortfalls or drawbacks,these will have to be addressed, Bhushan said.
Outstanding loans to Kingfisher is NPA,says SBI
State Bank of India,the largest creditor of ailing Kingfisher Airlines,today said the outstanding loans of the carrier is a non-performing asset for the bank. Kingfisher is an NPA for us. They are in default so they have 90 days to pay off their dues. The outstanding amount is Rs 500 crore, Pratip Chaudhuri,chairman,SBI,said.
SBI is the leader of the consortium of banks that have lent funds to Kingfisher Airlines and has an exposure of Rs 1,457.78 crore to the cash-strapped carrier,the highest among any of the lenders to the airline. This is followed by IDBI Bank (Rs 727.63 crore),PNB (Rs 710.33 crore),BoI (Rs 575.27 crore) and BoB (Rs 537.51 crore). Other lenders which have provided funds to the airlines include ICICI Bank,Central Bank of India,UBI,UCO Bank and Corporation Bank.