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India’s 2nd-largest airline is shutting down after running out of money

The embattled Indian airline Jet Airways said on Wednesday that it would shut down operations, confirming reports from Reuters.

Jet, the second-largest airline in India, has about $1.2 billion in debt and had been working for weeks to secure another loan to continue operations. But those discussions fell through on Tuesday when state-run banks rejected Jet’s request for $58 million, Reuters reported.

“Bankers did not want to go for a piecemeal approach which would keep the carrier flying for a few days and then again risk having Jet come back for more interim funding,” a bank source told the wire service.

In a statement, Jet Airways confirmed that it had suspended all flight operations and that its funding had run out.

“Since no emergency funding from the lenders or any other source is forthcoming, the airline will not be able to pay for fuel or other critical services to keep the operations going,” it said. “Consequently, with immediate effect, Jet Airways is compelled to cancel all its international and domestic flights. The last flight will operate today.”

Jet operated both domestic and international service from India, including to London, Brussels, Amsterdam, and Shanghai. In 2018, Jet had about a 13.8% market share, according to Indian government statistics, making it second in terms of traffic, behind IndiGo.

Shares of Jet Airways on India’s national stock exchange fell about 8% in trading on Wednesday.

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