Airlines press government to speed up delayed emergency credit disbursals

The airline industry body has escalated concerns about sluggish fund disbursals under ECLGS 5.0, a government-backed credit scheme designed to provide emergency liquidity support to businesses affected by economic stress. Despite formal sanctioning of credit facilities, participating banks have been slow to release the approved amounts, creating cash flow difficulties for carriers navigating an already demanding operational environment.

Airline operators have attributed the funding delays to risk aversion among lenders and administrative bottlenecks in the disbursement process. The sector, which continues to recover from pandemic-related disruptions while managing elevated fuel costs and infrastructure investments, has become increasingly dependent on accessing sanctioned credit lines to maintain operations and service expansion plans.

The industry body has formally approached the civil aviation ministry requesting direct intervention with financial institutions to accelerate the release of committed funds. Officials have emphasized that faster disbursals are critical to ensuring stability across the sector and enabling carriers to meet operational obligations and growth commitments.

The civil aviation ministry has not yet issued a public statement on the matter, though sources indicate discussions are underway with both banking and airline sector representatives. The outcome could have significant implications for capacity expansion plans and employment within India's aviation industry.