Government’s statement on Go First Crisis, bailout package will not be available before the engine issue is resolved!


ब्रिटानिया-बॉम्बे डाइंग टॉप पर,  फिर वरुण बैरी क्यों नहीं संभाल पाए वाडिया ग्रुप की Go First?

Wadia Group’s budget airlines GoFirst has declared itself bankrupt.Image Credit source: File Photo

The central government has made it clear about the GoFirst crisis that no concession is likely to be given until the airline resolves its engine issue with US-based Pratt & Whitney. Last week, GoFirst Airline approached the National Company Law Tribunal (NCLT), where it filed an application under Section 10 of the Insolvency and Bankruptcy Code, 2016. The airline had alleged that more than 50 per cent of the aircraft were grounded due to faulty engines. Due to which the cash crisis had to be faced.

What did VK Singh say

Responding to the ongoing crisis at GoFirst, VK Singh said that the problem with GoAir is that their flights run on Pratt & Whitney engines, which is facing management issues post-Covid-19. The reason for which engine manufacturing is stopped or not happening with the speed at which it should happen. When asked about the government bailout, Singh said, “Where will Pratt & Whitney get (engines) from?” Bailout can happen only when this issue is resolved.

Pratt & Whitney calls the allegation baseless

On Monday, the Wadia Group controlled GoFirst has asked the NCLT to give an early verdict on its petition. The company argues that the lessors are demanding the aircraft back from it and are bent on canceling the company’s registration. Meanwhile, Pratt & Whitney has claimed that the allegation that the GoFirst engine shut down is “surprising” and without any evidence. Apart from this, DGCA issued a second notice to Go First on Monday. The DGCA on Monday directed GoFirst to stop booking and selling tickets directly or indirectly with immediate effect and until further orders. The first notice was issued by DGCA on 2 May.

Will have to answer in 15 days

The regulator said that based on the response to the notice, it will decide whether GoFirst should be allowed to operate flights or not. The airline has been given 15 days to respond to the notice. Let us tell you that GoFirst had earlier announced the cancellation of all flights from May 3 to 5. After that in the evening, she announced that she is knocking on the door of NCLT for insolvency resolution. After which there was a fall in the shares of many lenders and there was an increase in the shares of other airline companies.

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