Business Daily from THE HINDU group of publications
Monday, Oct 20, 2008
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Business Daily from THE HINDU group of publications Monday, Oct 20, 2008 ePaper | Mobile/PDA Version | Audio | Blogs |
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Airlines Money & Banking - Financial Institutions Airlines want Govt push for funding
One of the things that needed to be done was to build the confidence of financial institutions in the long-term prospects of the Indian civil aviation sector. Ashwini Phadnis Hyderabad, Oct. 19 The Government should play a more proactive role in infusing confidence in financial institutions about the future prospects of the domestic airline sector, rather than work on providing a bail-out package for it. This will be needed as several airlines will be taking delivery of aircraft and could find it difficult to raise funds as banks and financial institutions do not seem to have much interest in funding for the industry. This was the general feeling at the Hyderabad air show, which concluded on Saturday. Addressing a closed-door session, several speakers, including the Executive Vice-President (Sales and Marketing and Customer Affairs) of Airbus Industrie, Dr Kiran Rao, and the Chairman and Managing Director of Air India, Mr Raghu Menon, felt that this was the need of the hour. Mr Menon suggested that the regulatory authorities issue statements to restore the confidence of financial institutions as was being done in the general market. Dr Rao felt that one of the things that needed to be done was to build the confidence of financial institutions in the long-term prospects of the Indian civil aviation sector. He added that one of the biggest stumbling blocks for the delivery of aircraft was going to be financing of the aircraft. To get over some of these problems the best way forward, according to the Managing Director, Center for Asia Pacific Aviation (India), Mr Kapil Kaul, would be if financial institutions create some kind of fund that will provide access to capital to airlines. He was of the opinion that while the next 12-18 months will be challenging for the industry, the benefits of the last four-to-five years will be visible post-2010. Speaking to the media, the Minister for Civil Aviation, Mr Praful Patel, said he will be meeting with the Finance Minister, Mr P. Chidambaram, and financial institutions soon to highlight the need to ensure there was enough funding for the domestic industry. The Minister, however, was categorical in saying that the Government could not give a cheque to the industry to help it out of the financial mess. Praful Patel assures steps to bail out airline cos AIG bailout likely to impact Indian aviation Domestic airlines see 12% drop in July passenger traffic Domestic airline industry hits air pocket More Stories on : Airlines | Financial Institutions
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