Govt to help financiers of Kingfisher Airlines repossess grounded planes
India will make it easier for leasing and finance firms to reclaim planes used by Kingfisher Airlines, two government sources said, after complaints that India was complicating the process.
Cash-poor and debt-hit Kingfisher, once India's second-largest carrier by market share, has not flown for five months and finance and leasing companies have warned that India could be starved of the funding it needs to fuel aviation industry growth if repossessing its planes is not made easier.
Germany plane financier DVB Bank SE has sued the aviation regulator and Kingfisher to have two Kingfisher planes it financed deregistered, allowing them to be flown elsewhere.
Kingfisher, which owes about $2.5 billion to banks, airports and others, according to an estimate by consultancy Centre for Asia Pacific Aviation, is reported to have 13 leased planes in its fleet. The number of leased planes could not immediately be confirmed with Kingfisher.
On Tuesday, the government sources said the ministry of civil aviation had decided to try to help remove obstacles to leasing companies' efforts to take back planes from airlines that cannot pay, in compliance with international standards.
Those obstacles include overruling tax authorities, banks and other creditors, which, desperate to recover their dues, are trying take possession of any asset related to Kingfisher.
Last year, Indian tax authorities seized at least two planes in Kingfisher colours, which were parked in Mumbai airport, even though the planes were leased.
Minimising red-tape would also help the leasing companies.
Earlier this year, U.S.-based International Lease Finance Corp (ILFC), one of the world's largest leasing
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