Government unveils ₹5,000cr emergency loan for passenger airlines, 7-year terms
The government just rolled out a ₹5,000 crore emergency loan package to help airlines deal with expensive jet fuel and disruptions from the West Asia conflict.
Eligible passenger airlines can secure up to 100% of peak credit, capped at ₹1,500 crore, with a generous seven-year payback period and two years before repayments even start.
Carriers eligible for ₹1,000cr plus ₹500cr
Airlines that qualify can get loans up to 100% of peak credit (₹1,000 crore), plus an extra ₹500 crore if their owners put in more equity.
Jet fuel now eats up nearly half of airline operating costs since March, squeezing profits and slowing domestic air traffic growth to just 1.3% in FY26 (the 2025-26 financial year) (down from over 7% in FY25).
The government is also capping jet fuel price hikes for domestic routes and cutting airport parking fees by 25%, but international flights aren't covered yet.