Ministries to discuss airline fuel dues Wednesday

October 21st, 2008 - 8:52 pm ICT by IANS  

New Delhi, Oct 21 (IANS) Petroleum Minister Murli Deora will meet his counterpart in the civil aviation ministry Praful Patel Wednesday to discuss the issue of huge dues owed by Indian airlines to the oil companies.“We are trying to (find) some solution, in which both airlines and oil companies will not suffer,” Deora told reporters here Tuesday.

India’s flagship carrier Air India and leading private airlines Jet Airways and Kingfisher Airlines together owe nearly Rs.20 billion to oil companies on account of aviation turbine fuel (ATF) purchase.

“There have been instances where airlines have defaulted in payment of bills even after the expiry of 60 days credit period,” he said.

Faced with a liquidity crunch and falling passenger load, Jet and Kingfisher struck a strategic alliance last week to lower costs and rationalise operations.

The private airlines, backed by Civil Aviation Minister Patel, have been angling for a bailout from the government, citing their financial problems.

“We are trying to help them… We don’t want airlines to shut down operation,” Deora said.

Patel last week lashed out at the finance minister and petroleum minister for not helping the airline industry.

Reacting to the attack, Deora said the issue of reducing tax and other dues from ATF was under the finance ministry and state governments.

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