Government Might Not Be Able To Create A Bailout Package For The Aviation Industry

Governments all over the world have sought out some form of a bailout package for their aviation industry, and Indian aviation is expecting the same from its government. But the government might not be able to create a bailout package for the aviation industry and to assume that it will is an unrealistic demand according to Centre for Asia Pacific Aviation (CAPA), which is a global aviation consultancy firm. The government of India is under a lot of pressure at the moment because there are only limited resources, but the demand from all the sectors of the economy for help is very high. Rationally, the government’s priority at the moment will only be providing basic economic safety and healthcare to the vulnerable citizens of society.

Options Government Has To Help The Falling Indian Aviation Industry

Few options which the government has to help the falling Indian aviation industry are either to infuse capital in the airlines in exchange for equity or getting banks to extend the lines of credit with the government’s assurance. But CAPA believes that neither of the options is likely to happen and the only way the government can help the Indian aviation industry at the moment is by introducing temporary waivers on the interest payments on liabilities. Even then, this may not be sufficient for the aviation industry to stay afloat.

Air India and Other Private Airlines Should Be Treated Equally

CAPA suggested that the government should treat Air India and the other airlines equally because these are extraordinary circumstances and need desperate measures to overcome it. There is a need for the aviation industry to come together and discuss all the elements that are required to be taken care of. At the same time, the USA has announced the most significant form of a bailout package for its aviation industry capped at $71 billion.