Snapping ATF supplies to Air India: Indian Oil Corporation says doesn't have cash-surplus, says chairman
IOC chairman said the company provides 90 days credit to Air India but the dues have been mounting and this must be 240 days now.
Last week, Indian Oil Corporation, along with Bharat Petroleum and Hindustan Petroleum, had stopped jet fuel supplies to Air India at six airports
Payment defaults amounted to around Rs 4,500 crore and pending since the past 240 days
The supplies are yet to be resumed even after a week
Mumbai: Indian Oil chairman on Wednesday defended cutting jet fuel supplies to the flag carrier Air India at six airports over non-payment saying that the national oil refiner is not a cash-surplus company.
Last week, Indian Oil Corporation, along with Bharat Petroleum and Hindustan Petroleum, had stopped jet fuel supplies to Air India at six airports--Kochi, Pune, Patna, Ranchi, Vizag and Mohali--over payment defaults, which amounted to around Rs 4,500 crore and pending since the past 240 days.
The supplies are yet to be resumed even after a week.
"We ourselves are borrowing around Rs 75,000 crore annually; that means we are a net borrower and not a cash-surplus company. To support credit to Air India, we need to borrow from markets," chairman Sanjiv Singh told reporters.
He said IOC provides 90 days credit to Air India but the dues have been mounting and this must be 240 days now.
"So the total dues to us, including interest, is more than Rs 2,900 crore. Although we don't take any formal bank guarantee from a public sector entity which we do from private airlines, now we are a little worried and cannot continuously support the airline," Singh explained.
He further said, "the decision to stop the fuel supply was not to cause any discomfort to the passengers but was to primarily indicate that IOC cannot continue to give credit indefinitely."
From IOC's point of view, it is a big call as it is a commitment beyond business and that is why it has been supporting the national carrier so far.
"We feel we have given them the right signal, but this was after a lot of follow-up with them. Unfortunately, we are still not seeing any improvement in Air India which is fighting its own problems as well," Singh added.
Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.
Iran executes wrestler Navid Afkari for murder during 2018 protests; IOC expresses shock at decision
Reports published abroad say Afkari was convicted on the basis of confessions aired on television after being extracted under torture, prompting online campaigns for his release.
Beijing is to host the 2022 Winter Olympics with rumblings of a boycott and calls to move the Games because of alleged human rights violations.
Tokyo Olympics 2020 consulting firm paid $3,70,000 to IOC official's son before and after Japan won bid
Papa Massata denied the allegations, saying the money he received was related to a "sponsorship deal made in China. There is nothing to do with the Tokyo Olympics."