Budget airline Go First plans to soon avail Rs 600 crore loan under the Emergency Credit Line Guarantee Scheme (ECLGS) for its operations amid rising air travel demand, according to a source. The source at the airline also said that promoters have infused around Rs 2,800 crore in the last 15 months which has helped the carrier tackle multiple headwinds, including due to the pandemic, travel curbs and higher fuel costs.
To help the airline industry, which is on the recovery path after being significantly hit by the pandemic, the government, last month, modified the ECLGS by raising the limit of loan that can be availed by an entity to Rs 1,500 crore from Rs 400 crore earlier.
The source said that so far, the airline has availed Rs 400 crore under the ECLGS. “We will be applying for Rs 600 crore under the ECLGS in the next few days. Banks like Central Bank, Bank of Baroda and IDBI are our lenders. We will be approaching them first to avail these funds,” the source told PTI.Out of the remaining Rs 1,100 crore funds available under the ECLGS, the source said the airline can now avail up to Rs 600 crore. The remaining amount of Rs 500 crore can be availed subject to certain government approvals, including clarity on the quantum of equity that will be infused by the promoters, the source added.
According to the source, the company has a cumulative working capital loan of Rs 2,650 crore. In September, Go First carried 8.15 lakh domestic passengers and its market share was at 7.9 per cent
.Earlier this week, aviation consultancy firm CAPA estimated the losses of Indian airlines to exceed USD 2.5 billion this fiscal. This is higher than its earlier projection of USD 1.4-1.7 billion for the same period.