Government may dilute rules to save Kingfisher Airlines

Mumbai: The government's refusal to suspend the licence of Kingfisher Airlines, despite its crippling financial problems, is baffling as civil aviation rules clearly empower the regulator to act against a defaulting airline, unable to pay salaries, experts say.
The Vijay Mallya-owned airline faced a stunning meltdown last year after a cut-throat industry price war squeezed its cash flow, forcing it to suspend a majority of its flights and nearly halt operations. Since November last year, the company has paid monthly salaries to employees only in fits and starts and has been forced to drastically reduce its operations. It has defaulted on loans, forcing many banks to classify it as a non performing asset (NPA).
11/09/12 Manisha Singhal/Times of India

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Categories: Kingfisher Sep 2012