The government is in touch with SpiceJet over the airline’s continuing operational and financial challenges, even as the cash-strapped carrier seeks additional funding under the Emergency Credit Line Guarantee Scheme (ECLGS) to improve liquidity and stabilise its operations. The airline has been grappling with financial stress that has affected its ability to meet day-to-day expenses and employee payment obligations. It has been pursuing government-backed credit support as part of efforts to restore normal operations and strengthen its finances. SpiceJet currently has an operational fleet of around 21 aircraft, significantly below its earlier capacity, even as it works to bring grounded aircraft back into service and expand its network.
Seeking financial support
The airline has sought assistance under ECLGS 5.0, which was approved by the Union Cabinet in May to provide targeted credit support to airlines facing financial stress amid elevated aviation turbine fuel prices, airspace disruptions and the fallout of the West Asia crisis.
The scheme earmarks Rs 5,000 crore specifically for the aviation sector and provides government-backed credit to eligible airlines. Under its provisions, assistance can go up to Rs 1,500 crore per borrower subject to specified conditions.
SpiceJet has already been pursuing funding through the scheme as it attempts to address short-term liquidity constraints. The carrier has maintained that it is working towards normalising its business activities while dealing with external factors that have affected operations and cash flows.
Financial pressure has also resulted in delays in salary payments to some employees, including pilots. SpiceJet has previously said employee payments were being released in phases.
Plans fleet expansion
Despite the financial challenges, the airline is simultaneously preparing to expand capacity. SpiceJet on Thursday said it had finalised lease agreements to induct 20 aircraft — 15 Boeing and five Airbus planes — between mid-October and mid-November ahead of the winter schedule.
The carrier is targeting an expansion to around 200 daily flights as the additional aircraft enter service.
SpiceJet has been pursuing a broader turnaround strategy involving fleet restoration, fresh aircraft induction, liability settlements and fundraising. It had earlier raised substantial equity capital to revive operations, but its recovery has remained under pressure from high costs and liquidity constraints.
In the third quarter of FY26, SpiceJet reported a net loss of Rs 268 crore after forex adjustments and exceptional items, although this narrowed considerably from the preceding quarter.
The government's ECLGS 5.0 programme is intended to help airlines manage temporary liquidity mismatches and preserve operational capacity at a time when fuel costs, exchange-rate volatility and geopolitical disruptions have added to financial pressures across the aviation sector.