Jet Airways crisis leaves passengers fuming, employees on edge

The fate of Jet Airways, once one of the largest private airlines in India, now hangs in the balance for an immediate need of Rs 1,000 crore. This, however, has become a tall order for the now-ailing airline as banks are showing reluctance to fund it.

Meanwhile, as Jet Airways curtailed its operations from a fleet of 120 planes to just five remaining now (four turboprops and one Boeing 737), it is the ticket-buying passengers who are at the receiving end of the carrier's troubles.

"People have purchased tickets beforehand, planning for their summer vacation travels. We are receiving complaints also about higher ticket prices," said Pradeep Singh Kharola, secretary, ministry of civil aviation.

On Tuesday morning, Civil Aviation Minister Suresh Prabhu had asked Kharola to convene a review meeting on the Jet Airways situation. The minister sought necessary actions to protect the rights and safety of passengers.

"Directed Secretary @MoCA_GoI to review issues related to Jet Airways, especially increasing fares, flight cancellations etc. Asked him to take necessary steps to protect passenger rights and safety, and to work with all stakeholders for their well-being," Prabhu said in a tweet.

Last week, Prabhu had called another review meeting to look into passengers' issues caused by the crisis at Jet Airways. To tide over passengers' worries over flight cancellations by Jet Airways and a corresponding hike in fares, the DGCA issued notes to other airlines.

However, these earlier efforts seemed to have yielded little results, as Prabhu's official Twitter handle kept getting flooded with queries from troubled passengers of Jet Airways. To make a difference, the DGCA, on Tuesday, identified 10 routes on which the fares had spiked substantially after the Jet Airways crisis erupted.

To tide over its financial worries, another meeting was held at the behest of the finance ministry. “The meeting heard the views of four of the 26 banks that form the lenders' consortium of Jet Airways," said a finance ministry official, aware of the developments.

The lenders' consortium, led by SBI Capital Markets, had earlier agreed to release Rs 1,000 crore of the Rs 1,500 crore interim credit to the airline, to meet working capital needs. "Banks are now of the opinion that they do not want to just throw more good money to recover bad dues," said the senior finance ministry official, who did not want to be quoted.

While a board meeting of the beleaguered airline was under way in Mumbai, there were long discussions also being held at Raisina Hill. After the meeting concluded late on Tuesday, bankers were not yet convinced to release any funds in a hurry, until a decision is taken about infusing fresh capital by one of the four selected bidders—India's sovereign wealth fund National Investment Infrastructure Fund, private equity firms TPG Capital, Indigo Partners and Jet Airway's JV partner Etihad Airways PJSC.

SBI Caps is likely to formally declare the short-listing of the four bidders for Jet Airways and selection of one in the next round. This would then allow banks to undertake a proposed equity conversion of Jet Airways as part of its bank-approved revival plan to rid it of the debt of more than Rs 10,300 crore.

Jet Airways CEO Vinay Dube had earlier claimed that the airline had not received the promised interim payout from banks, leading it to further defer salary payouts to more than 15,000 employees who are on role or are contract employees of the airline.

At Tuesday's board meeting, one of the important decisions taken by the new management of Jet Airways was to give Dube the powers to pull the plug on operations of the airline. "Our flight operations could be stopped anytime now,'' said a senior executive of Jet Airways.

On Tuesday, close to 4,000 employees of Jet Airways sent out personal notes to the Prime Minister's Office, citing the ordeal they and their families are facing for the last three months.

"Our only hope now is that the government acts humanely on our situation and helps restore operations as they were earlier," said the Jet Airways official, who has been working long hours to resolve the crisis, even while being hospitalised.