India’s beleaguered Jet Airways founder held at airport

Agence France-Presse . Mumbai | Published: 00:00, May 27,2019


Indian Immigration authorities on Saturday stopped former Jet Airways chief Naresh Goyal and his wife from travelling to London, an official said, a month after the debt-laden company grounded its fleet.
Goyal was taken into custody at Mumbai’s international airport along with his wife Anita after authorities recalled the Dubai bound Emirates flight as it headed to the runway for take-off, a spokesperson for the immigration department said in a statement to AFP.
Officials gave no explanation for the couple’s travel ban but some media reports said they were allowed to leave the airport later.
Goyal is not under investigation but a number of high-profile businessmen have fled India over their alleged involvement in financial crimes, causing a massive public outcry.
Emirates said they were ‘co-operating fully with the relevant authorities.’
The 69-year-old stepped down from the company’s chairmanship and board in March following a debt restructuring pact with lenders as it reeled under a loan of $1.2 billion.
Anita also stepped down from the board.
Once India’s top airline, Jet halted its operations after a consortium of lenders declined to pay emergency cash as they failed to find a buyer for a 75 per cent stake in the carrier in April.
The consortium led by State Bank of India, India’s biggest state-owned bank, took control of Jet in March, pledging to give $218 million in ‘immediate funding support’ as part of a rescue plan.
But the lenders refused dole-out cash to the beleaguered airline that has failed to pay employees’ salaries since January, forcing hundreds on to the streets as some 20,000 staff face losing their jobs.
Bad investments, competition from several low-cost carriers, high oil prices and a weak rupee have led to Jet’s current financial
predicament. Mismanagement has also plagued the airline.
Analysts trace the start of Jet’s financial problems to its 2006 purchase of Air Sahara for $500 million in cash.
Goyal, a travel-agent-turned entrepreneur, launched Jet in 1992 after the Indian government passed a series of reforms designed to make the economy more market-driven.
The Mumbai-based carrier quickly gained a reputation for introducing new initiatives — Jet was the first Indian airline to offer a frequent flyer programme and in-flight entertainment.
But it began to take a battering from new, well-run budget airlines including IndiGo, GoAir and SpiceJet, which were founded between 2005 and 2006.
Another low-cost carrier, Kingfisher Airlines closed in 2012 after it failed to repay loans worth millions of dollars to state-owned banks. Its owner Vijay Mallya fled India in 2016 and is currently fighting an extradition case in London court against his deportation for facing financial fraud trial.

More about:

Want stories like this in your inbox?

Sign up to exclusive daily email