Kingfisher loses international flying rights

A Kingfisher counter at New Delhi airport Kingfisher was once India's second biggest airline but has been grounded since October

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India's Ministry of Civil Aviation has decided to withdraw international flying rights and domestic slots from Kingfisher Airlines, in a fresh blow to the debt-laden firm.

The carrier has been grounded since October after repeated strikes by workers over unpaid wages.

It has $1.4bn (£870m) in debts and, earlier this month, its creditors said they would start recalling their loans.

Kingfisher's licence to fly expired at the end of 2012.

The company has two years from the point of expiry to apply for a renewal.

Kingfisher, controlled by liquor baron Vijay Mallya, was once India's second biggest airline but has reported annual losses for five years in a row.

Final blow?

The Ministry of Civil Aviation said it was withdrawing with immediate effect Kingfisher's international bilateral traffic rights "on account of non-utilisation", affecting routes to Bangladesh, Hong Kong, Nepal, Singapore, Sri Lanka, Thailand, UAE Dubai and the UK.

These international traffic rights will be made available to other carriers, making an extra 25,000 seats available per week, "some of which are much in demand by these carriers", the Ministry said in a statement.

It has also withdrawn the domestic slots at Indian airports allocated to Kingfisher and will make these available to other domestic carriers.

The BBC's Shilpa Kannan in Delhi said it was the withdrawal of the domestic slots that was the most significant move, because at congested airports such as Mumbai, there are already many carriers vying for this space.

She added that with a consortium of 17 banks and a number of government agencies already trying to recover their dues, this could be the last blow to the airline.

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