Indian carriers troubled by a financial crunch on Wednesday got time until March 2009 to clear their dues, estimated at about Rs 2,500-2,800 crore (Rs 25 to Rs 28 billion), to oil companies in equated monthly installments.
The decision was taken at a meeting called by Petroleum Minister Murli Deora with airline bosses and Civil Aviation Minister Praful Patel to work out ways to help airlines stay afloat without hurting the interests of oil firms.
Patel told reporters that it was decided that oil companies would extend the credit period on jet fuel purchase to 90 days from 60 now (applicable till March 2009), as also allow airlines to clear dues in EMIs by March 2009.
Kingfisher Airlines Chairman and CEO Vijay Mallya, Jet Airways Executive Director S K Dutta and Air India Chairman Raghu Menon were among those who attended the meeting.
The meeting was necessitated as some airlines, including Jet, have defaulted on payments at the end of their 60-day credit period on Aviation Turbine Fuel purchase.
Representatives from state-run oil firms Indian Oil Corp, Bharat Petroleum and Hindustan Petroleum and finance ministry officials also attended the meeting.
