ibnlive » India

Nov 26, 2011 at 02:06pm IST

PM meets airline chiefs over financial crisis

New Delhi: Prime Minister Manmohan Singh met the chiefs of major domestic airlines to take stock of the financial health of the sector. The meeting took on Saturday morning.

Airlines have been complaining about high fuel cost and unreasonable taxes levied on the sector against the backdrop of the financial crisis of Kingfisher Airlines. Jet fuel prices have increased by 30 per cent since December 2010.

Three major airlines - Jet, SpiceJet and Kingfisher have reported heavy losses in the second quarter.

Kingfisher's CEO Sanjay Agarwal, Jet Airways' Naresh Goyal and Rahul Bhatia of IndiGo were present at Saturday's meeting.

Currently only 49 per cent Foreign Direct Investment is allowed in Indian carriers by non-airline players. The policy prohibits foreign airlines from directly investing due to security reasons.

Sources said the airlines are looking for a bailout, which is tough for the government to grant them as the Opposition will oppose it.