Spicejet’s Neil Mills: No logic to Govt. bailout for Kingfisher

New Delhi:  Amidst a general Government flip-flop over a bailout for private carrier Kingfisher Airlines, with aviation minister Vyalar Ravi first expressing support for the stricken carrier and then cooling off, and subsequently prime minister Manmohan Singh expressing unequivocal support, it is but natural that rival private carrier's should now question the motives behind the government move.

SpiceJet chief Neil Mills today questioned government motives on the use of taxpayer money to bail out a private sector company.

"It is the private sector. Why should there be any bailout for a private air carrier. I do not see any logic why taxpayer's money should be used to bail out a private company," Mills said when asked by media representatives whether the government should bail out Kingfisher Airlines.

Last week, prime minister Manmohan Singh said steps would have to be taken to help private sector entities if they get into difficulties.

Earlier, Kingfisher Airlines chief Vijay Mallya sought government help in bailing his carrier out of financial bankruptcy and minister Ravi promptly conveyed his request to the ministry of finance asking that banks be asked to help restructure Kingfisher's debt once again.

A restructuring exercise earlier in the year has left a consortium of banks licking their wounds as a conversion of debt into equity has resulted in a loss of 70 per cent with Kingfisher shares sinking to lifetime lows at the bourses. They have now asked the carrier to sink in equity to the tune of Rs800 crore.

The Government move to provide support to a private enterprise in a free market economy riled even corporates with a doyen the Indian corporate world like Rahul Bajaj critical in his response. Yesterday, Bajaj said that in a free economy, "those who die, must die".