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Air India cancels one Alliance Air flight

The only flight that was cancelled was an Alliance Air between Kochi and Agatti (in the Union Territory of Lakshadweep).

ET Bureau|
Aug 24, 2019, 07.39 AM IST
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New Delhi: Air India cancelled one Alliance Air flight on Friday after state-owned oil companies halted sales of aviation fuel to the national carrier pending the payment of dues.

“The only flight that was cancelled was an Alliance Air between Kochi and Agatti (in the Union Territory of Lakshadweep). This has led to Agatti being cut off from the country as Alliance Air is the only airline that connects Agatti,” said a company official who did not want to be identified.

Oil marketing companies stopped jet fuel supplies to Air India at six airports on Thursday — Kochi, Pune, Patna, Ranchi, Vizag and Mohali — after the airline defaulted on payments in the range of Rs 5,000 crore, including interest on dues.

The official said the airline is filling fuel at airports where oil companies have not stopped supplies. Air India’s flight between Pune and Mohali stopped en route in Mumbai for refuelling.

“The fuel supply at other airports is normal and the national carrier is managing its operations,” the official added.

The airline hasn’t been making full payments for fuel purchased daily. The company is short of cash to fund operations as the government has decided not to provide any equity support to the airline this year.

The airline also must make principal payments of Rs 4,500 crore for debt and while it has sought the government’s support in this regard, there has been no assurance of any funding.

“Considering the huge outstanding from Air India and their ramifications for their working capital requirements, the three oil marketing companies have been constrained to take the decision of stoppage of fuel supply at six airports. However, Air India flights operating from the six airports, where ATF supplies have been suspended, have been tanking up from other airports,” IndianOil said in a statement.


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