The nationalised carrier Air India is also in the red
INDIA’S airlines are expected to report a combined loss of about Rs100bn ($1.9bn/£1.17bn) for the previous financial year, India’s aviation minister Ajit Singh said on Thursday (April 3).
Singh also said all airlines operating in the country - barring low-cost IndiGo - are making losses, in a written reply to parliament.
“The total operational losses for all the airlines for the period 2008-09, 2009-10 and 2010-11 are around Rs190bn ($3.62bn/£2.23bn) and Rs100bn loss is anticipated in 2011-12,” which ended in March, Singh told parliament’s upper house.
The details were based on financial data filed by airlines with the local regulator, Directorate General of Civil Aviation (DGCA), Singh added.
The sector showed a combined loss of around Rs80bn($1.52bn/£939m) in the previous fiscal year that ended March 2011, analysts said.
India’s airline sector, once one of the most prominent symbols of the country’s economic progress, has been battered by high fuel prices, fierce competition and an economic slowdown.
Private airline Kingfisher - which has shut down its overseas operations and slashed domestic flights - has been one of the worst hit and desperately requires a cash injection to implement a turnaround plan.
India’s biggest private carrier Jet and national carrier Air India are also in the red.
India’s government is yet to decide on clearing a proposal to allow foreign airlines to pick up stakes in domestic carriers, seen as a lifeline for some of those making losses.
Kingfisher’s owner, liquor baron Vijay Mallya, is strongly in support of the new foreign direct investment (FDI) policy which could be Kingfisher’s last chance of survival.
Foreign airlines are currently barred from holding stakes in Indian airlines though other overseas investors can hold up to 49 per cent.
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