20,000 jobs at stake as Jet Airways grounds flights amid lack of funds
New Delhi, Apr 17: Jet Airways has cancelled all its domestic and international flights with immediate effect as lenders have rejected its request for additional funds.
The move comes after lenders rejected Jet's request for additional funds. The cash-strapped airline had requested emergency funds worth Rs. 400 crore from the State Bank of India-led consortium of lenders to stay afloat.
Jet Airways has announced temporary grounding of operations, putting at stake 20,000 jobs and thousands of crores in passenger refunds, dues to vendors and over Rs 8,500 crore to banks.
"Bankers did not want to go for a piecemeal approach which would keep the carrier flying for a few days and then again risk having Jet come back for more interim funding," one of the bank sources directly involved in Jet's debt resolution process was quoted as saying in the Reuters report.
The airline had already suspended its international operations till April 18 and it was operating only five planes, reported news agency Press Trust of India on Tuesday quoting Civil Aviation Secretary Pradeep Singh Kharola.
On Tuesday, Jet Airways founder Naresh Goyal decided not to bid for acquiring a stake in the airline.
With uncertainty mounting over the future course for the airline, which has been in operation for more than 25 years, its shares crashed nearly 19 per cent during the day amid reports that the carrier might temporarily suspend operations.
In the past few weeks, Jet Airways has been grounding planes as lessors have moved to de-register and take back their aircraft, even though the company's lenders have sought expressions of interest from potential investors in the company.