The Airports Authority of India (AAI) is considering putting SpiceJet on “cash-and-carry” mode soon if the airline is unable to furnish a bank guarantee of about Rs 200 crore against its dues by December 10.
With aviation regulator, directorate general of civil aviation (DGCA), also planning to issue a show cause notice to SpiceJet for defying its directive regarding advance bookings beyond a month, worse days could be ahead for the carrier. “The AAI would put SpiceJet on cash-and-carry mode from Wednesday if it does not furnish a bank guarantee to the airport operator against its dues by that time,” a senior official said.
After reviewing the financial and operational parameters of the airline on Friday, director-general of civil aviation Prabhat Kumar had issued a series of instructions to SpiceJet, also directing them to file a “convincing schedule” by December 15. DGCA had also instructed the airline not to accept bookings for cancelled flights, to refund all affected passengers within a month, and not to take advance bookings beyond a month.
While the DGCA withdrew 186 flight slots of SpiceJet at various airports across the country on Friday, the airline had said on Saturday that the advance booking restriction would be counter-productive, and it would discuss the pros and cons of this with the DGCA. On Monday, however, the airline continued to take advance bookings, even for dates in 2015.
“The DGCA is likely to issue a show cause notice to SpiceJet as the airline continues accepting advanced bookings of beyond one month against the directives on the issue,” official sources said.
Some officials also believed that a notice would be one in a series of steps that could lead to the cancellation of the airline’s licence. A SpiceJet spokesperson defended the advance bookings, saying it has already informed the regulator that it wants to discuss the issue this week. “We have told DGCA that we would like to discuss the matter and plan to do so tomorrow (Tuesday) post a board meeting,” the spokesperson said.
CAD widens to 2.1% on higher gold imports
MUMBAI: India’s current-account deficit widened to $10.1 billion, or 2.1 per cent of the GDP, during the second quarter ended September 2014 as gold imports surged and non-resident Indian deposits almost halved.
CAD had reached a low of 1.2 per cent of GDP in the same period of last year and 1.7 per cent in the preceding quarter.
However, during the six month period of April-September of 2014-15, CAD has moderated to 1.9 per cent of GDP as against 3.1 per cent in the same period of last year due to lower trade deficit and a marginal rise in net services receipts. Gold imports had surged after the government and the RBI relaxed the import curbs on May 22. Gold imports in September alone had soared to $3.75 billion, up almost 450 per cent from September 2013. During six months, non-monetary gold imports were $14.65 billion.
According to Reserve Bank of India figures, the balance of payment (BoP) stood at a surplus of $6.9 billion during July-September, a fourth consecutive quarter of surplus, although that was narrower than the $11.2 billion surplus in the previous quarter.
“The increase in CAD was primarily on account of higher trade deficit contributed by both a deceleration in export growth and increase in imports,” the RBI said.