Topic Of The Day:-“Beyond Mayday: On Bankruptcy Code For Aviation Sector”

The Jet Airways Case Has Takeaways For The Bankruptcy Code As Well As For Other Airlines

Jet Airways may have finally run out of runway. Two months after Jet halted all flight operations, lenders to the beleaguered full service airline have decided to refer it to the National Company Law Tribunal and initiateinsolvency proceedings in a bid to recover the money owed to them. The lenders’ consortium arrived at this conclusion after unsuccessfully trying to rope in a white knight — an investor who would have helped put the airline’s flights back in the air, thus saving thousands of jobs and potentially helping turn around the carrier. And while, theoretically, the Insolvency and Bankruptcy Code was conceived to help achieve a resolution that could potentially protect a running business and help revive it through capital restructuring under a new promoter, in Jet’s case the chances of a resolution seem rather remote now. The lenders have to shoulder a fair share of the blame as the delay in initiating the insolvency process has drastically eroded some of the airline’s key assets, including customer goodwill, its aircraft fleet, routes and landing slots and even its experienced flight crew. Ironically, while the banks may have viewed Jet’s request for emergency lines of credit in the run-up to the suspension of operations as ‘good money chasing bad money’, nothing could potentially kill an airline more effectively than protracted grounding. And one doesn’t even need to look too far back in time to recall what happened to Kingfisher Airlines.

It would surely have been instructive for the creditors to revisit the Chapter 11 bankruptcies that a clutch of U.S. legacy airlines opted for in the early 2000s. That protection helped Delta and United to not only survive the crisis of confidence in aviation triggered by the terrorist attacks of September 11, 2001, the surge in jet fuel and labour costs and the intense competition from low-cost carriers, but emerge stronger and rank among the top five contemporary American carriers. A look at some of Jet’s industry-specific operational metrics, at least until the recent cash-starved implosion, show an airline that had consistently posted growth in terms of revenue passenger kilometres and cargo tonnage till the 2017-18 financial year. So it wasn’t a lack of business that led to Jet’s stall and crash. For the health of India’s airline industry, it will be crucial for policymakers to review several issues that affect viability: from the way aviation turbine fuel is taxed, to the charges airports levy. The carriers too need to reappraise their pricing strategies and ensure that in the quest for market share they don’t end up in a race to the bottom. The government must take a closer, harder look at the IBC and examine the viability of a framework akin to Chapter 11 that may ultimately be more suited to industries like aviation.



Meaning: (of a supply of something) be used up.

Synonym: be used up, dry up, be exhausted, be finished, give out, peter out, fail

Antonym: be plentiful

Example Sentence: “our food is about to run out”


Meaning: bring or come to an abrupt stop.

Synonym: Stop, come to a halt, come to a stop, come to a standstill

Antonym: start, go, continue

Example Sentence: “Len halted and turned round”


Meaning: put in a very difficult situation.

Synonym: Besieged, under siege, blockaded, surrounded, encircled

Antonym: Aid, Please, Help

Example Sentence: “he led a relief force to the aid of the beleaguered city”


Meaning: direct the attention of someone to.

Synonym: pass, hand on, send on, transfer, remit, direct, leave, commit

Antonym: Ignore, Neglect, Remove

Example Sentence: “I refer my honourable friend to the reply that I gave some moments ago”


Meaning: a body established to settle certain types of dispute.

Synonym: arbitration board/panel, board, panel, committee; industrial tribunal

Example Sentence: “an industrial tribunal ruled that he was unfairly dismissed”


Meaning: cause (a process or action) to begin.

Synonym: Begin, start off, commence, take action on, usher in; institute, inaugurate

Antonym: complete, finish

Example Sentence: “the government has initiated an extensive programme”


Meaning: the state of being insolvent.

Synonym: Bankruptcy, liquidation, failure, collapse, ruin, financial ruin, ruination

Antonym: solvency

Example Sentence: “the club was facing insolvency”


Meaning: have an obligation to pay or repay (something, especially money) in return for something received.

Synonym: be in debt (to), be indebted (to), be in arrears (to), be under an obligation (to)

Antonym: Settle up

Example Sentence: “they have denied they owe money to the company”


Meaning: an association, typically of several companies.

Example Sentence: “the amount awarded for loss of consortium must be included”

10.back in the air

Meaning: In one’s and/or others’ awareness; evident in the immediate surroundings.

Synonym: immediate, Impending, inevitable

Antonym: avoidable, distant, escapable

Example Sentence: There was a buzz in the air at the festival, and it was all due to the return of the legendary bluesman

11.turn around

Meaning: an abrupt or unexpected change, especially one that results in a more favourable situation.

Synonym: Cancellation, Turnabout, Annulment

Antonym: Approval, Enactment, Validation

Example Sentence: “it was a remarkable turnaround in his fortunes”


Meaning: form or devise (a plan or idea) in the mind.

Synonym: Think up, think of, come up with, dream up, draw up, devise, form, formulate

Antonym: Neglect, Avoid, Disbelieve

Example Sentence: “the dam project was originally conceived in 1977”


Meaning: restore to life or consciousness / regain life, consciousness, or strength.

Synonym: Resuscitate, bring round, bring to life, bring back, bring someone (back) to their senses

Antonym: Abolish

Example Sentence: “both men collapsed, but were revived”


Meaning: make (someone or something) late or slow.

Synonym: detain, hold up, make late, retard, keep (back), slow up

Antonym: advance, bring forward

Example Sentence: “a few guests were delayed by rush-hour traffic”

Meaning: the period preceding a notable event.

Synonym: Lead-In, Warm-Up

Example Sentence: “a programme aimed at lowering unemployment in the run-up to the next election”


Meaning: lasting for a long time or longer than expected or usual.

Synonym: Prolonged, extended, stretched out, drawn out, long-drawn-out

Antonym: Curtail, shorten

Example Sentence: “a protracted and bitter dispute”


Meaning: useful and informative.

Synonym: Informative, instructional, informational, illuminating, enlightening, revealing

Antonym: unenlightening

Example Sentence: “it is instructive to compare the two projects”


Meaning: (of a response) caused by particular action, process, or situation.

Synonym: activate, set off, set going, trip

Antonym: Destroy, End, Halt

Example Sentence: “an allergy can be triggered by stress or overwork”


Meaning: of the present time; modern:

Synonym: Current, Instant, Latest

Antonym: Future, Old

Example Sentence: a lecture on the contemporary novel.


Meaning: an instance of something collapsing violently inwards.

Synonym:Botch, bust, Checkmate

Antonym: Accomplishment, Advantage, Benefit

Example Sentence: “the star undergoes a violent implosion caused by gravity”


Meaning: ability to work successfully.

Example Sentence: “an interest in the long-term viability of British companies”


Meaning: appraise or assess again or in a different way.

Example Sentence: “the Tory party has reappraised its strategy”


Meaning: impose a tax, fee, or fine on.

Synonym: Impose, charge, exact, demand, raise, collect, gather; tax;

Example Sentence: “there will be powers to levy the owner”


Meaning: of similar character.

Synonym: Similar, related, close, near, corresponding, comparable

Antonym: unlike

Example Sentence: “something akin to gratitude overwhelmed her”


Meaning: a time of intense difficulty or danger.

Synonym: catastrophe, calamity, cataclysm, emergency, disaster

Antonym: Agreement, Calm, Benefit

Example Sentence: “the current economic crisis”


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